Insurance premium paid between Oct 12-Mar 31 period eligible for reimbursement under LTC scheme

Premiums paid for insurance policies purchased between October 12 this year and March 31, 2021, will be covered under the leave travel concession (LTC) cash voucher scheme for central government employees, according to the finance ministry.

The beneficiaries need not submit original bills of their purchases in order to avail reimbursement under the scheme and self-attested copies would do instead, it said.

The clarification on the scheme came in the third set of frequently asked questions (FAQs) released by the finance ministry on Wednesday.

The ministry received a number of questions on whether premiums paid for existing insurance policies would be eligible under the LTC scheme.

While premiums paid for existing insurance policies would not count, those made towards fresh policies purchased during the specified period would be eligible.

Government employees had asked whether it was mandatory to submit original bills as they were needed to claim warranty or ownership of the items or services purchased.

“No, self-attested photocopy would suffice. However, the original bills may be produced on demand for information,” said the ministry.

Earlier, the ministry had said original bills would have to be submitted as proof of purchase in order to receive the reimbursement.

Last month, finance minister Nirmala Sitharaman had announced the scheme as part of the government’s “fiscally prudent” measures to stimulate demand.

Under the LTC scheme, central government employees may encash their leaves and, in lieu of the deemed fare of travel on trips they could not take due to the pandemic, choose to spend three times the amount on items or services attracting a goods and services tax rate of at least 12%.

After submitting the vouchers or bills of such transactions, made via digital mode, cheque or demand draft, by March 31 next year, they will receive reimbursement of the deemed travel fare amount and the leave encashment.