Master Topic: All queries related to Special LTC Package

There have been a large number of topics being created asking various queries related to Special LTC Package announced by the Department of Expenditure vide DoE O.M. - SOP on Disbursal of Special Festival Package to Govt. Servants - F.No. 12(2)/2020-E.IIA(Pt.) dated 13th October, 2020.

A compilation of Frequently Asked Questions notified by the Department of Expenditure is already available at Compilation of FAQs on Special LTC Cash Voucher Scheme.

All the questions posted till date by various users are being merged into this topic. All future queries related to the Special LTC package will also be merged into this topic, if posted elsewhere.

Checkout: Special LTC Package - Benefit Calculator

Is leave encashment mandatory? Is not what will be the estimate amount?
What is the calculation?

Can I purchase vehicle insurance with LTC cash voucher?

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As per the clarifications given by the Department of Expenditure vide DoE Clarifications on Special LTC Package - O.M. No.12(2)/2020-E.II(A) dated 20th October, 2020 :
  • Any goods and services which attract GST of 12% and above would qualify. The invoice with GST details should be submitted and payment should have been made through digital mode.
  • The purchase should have been done from the date of issue of the O.M. till the end of the current Financial Year.
  • The invoice which is being submitted for reimbursement under the scheme should be in the name of the employee who is availing the scheme.
So, technically, vehicle insurance having 18% GST can be produced against bills to be submitted for availing the benefits of LTC Package Scheme. Even the regular telephone bills qualify for submission under the Special LTC package.
  1. Can LTC cash voucher package be availed by procuring items having GST 12% & above on loan basis/EMI ?

  2. Is it necessary to show the proof of payment made (like copy of transaction made/pass book xerox)?

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UPDATE (10.11.2020): As per DoE O.M. dt.10.11.2020 - Clarifications in r/o Special LTC Package Scheme (FAQ - 2) - No.12(2)/2020-E.II(A), Purchase of any goods or services which attract GST of 12% and above qualify for reimbursement under this scheme. Purchases on EMI basis are also permissible. The purchase should have been effected after the issue of the order i.e. 12.10.2020 and should have an invoice.

As per DoE’s O.M. dt.12.10.2020, the Government has announced this LTC package with a view to compensate and incentivise consumption by Central Government employees thereby giving a boost to consumption expenditure.

Any goods and services which attract GST of 12% and above would qualify. The invoice with GST details should be submitted and payment should have been made through digital mode.


1) If you can produce the Tax Invoice, that would be sufficient, since the Government’s view is to give a boost to consumption expenditure. EMI/loan is personal affair, which obviously will be repaid by the customer, which is not affecting the consumption in any way. Moreover, the invoices from e-commerce platforms do not contain the payment method i.e. whether EMI or full payment. An example bill can be seen below:

2) As per DoE’s clarifications, the payment mode should be digital. In order to verify one’s claims, departments may ask for evidence. As of now, there are no clear-cut guidelines given by the DoE regarding provision of passbook photocopy, etc., and hence the procedure for claims may vary from Department to Department. This topic will be updated if there is an update later from the DoE.

Can credit card be used for Special LTC package?

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Yes. As per the clarifications given by the Department of Expenditure, any purchase with digital mode is to be supported by invoice. Based on production of invoice the spending is calculated. The intention of this scheme is to encourage every mode of purchase. It is for the employee to choose a suitable digital mode.

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Are transactions through Phone pe, paytm, G pay etc. permissible to avail LTC special package?

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Yes. As per the clarifications given by the Department of Expenditure, any purchase with digital mode is to be supported by invoice. Based on production of invoice the spending is calculated. The intention of this scheme is to encourage every mode of purchase. It is for the employee to choose a suitable digital mode.

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Can health insurance premium receipt 18% GST be produced on the list of bills against LTC encash scheme ?

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As per the clarifications given by DoE vide O.M. dt.25.11.2020, existing insurance premiums are ineligible.
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Are new LIC, PLI and Health Insurance policies procured after 12/10/2020 eligible for availing LTC package?

Can I avail Special LTC cash package without taking advance? Can I claim directly after purchasing a product? Should I give any intimation before buying a product without advance?

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As per DoE’s O.M. dt.12.10.2020 - reimbursement under this package is as per the details given above on receipt of invoices of purchases made / services availed during the period post the issuance of this order from the employees who are desirous to avail this package.
Hence, prior intimation may be required. As far as advance is concerned, it is up to the employee whether to draw advance or not. As per clarifications given by DoE vide O.M. dt.20.10.2020, if advance is required for the purpose the same is to be mentioned while applying for the package.

I would like to buy raw material of wood for household furniture. Shall I submit that bill for reimbursement of the special LTC Package?

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As per Department of Expenditure’s clarifications (Compilation of FAQs on Special LTC Cash Voucher Scheme), the Special Cash Package Scheme in lieu of one LTC is to be compensate and incentivise consumption by Government Employees. Purchase of any goods or services which attract GST of 12% and above qualify for reimbursement under this scheme. The purchase is to be supported by invoice, after the issuance of the DoE O.M. - Special cash package equivalent in lieu of Leave Travel Concession Fare for Central Government Employees during the Block 2018-21. - F.No.12(2)/2020-EII(A) dated 12th October, 2020.

Be it raw material of wood / furniture or whatever, if the goods / services is/are having more than 12% GST qualifies for this package.

Since you didn’t mention the quality / type of wood being procured, the following types may be perused to ascertain whether the type of wood procured by you is having 12% or more GST:

HSN Code Description Rate (%) Effective From CESS (%)
4405 Wood wool; wood flour 12 28/06/2017
4413 Densified wood, in blocks, plates, strips, or profile shapes 18 14/11/2017
4414 Wooden frames for paintings, photographs, mirrors or similar objects 18 14/11/2017
4416 Carved wood products, art ware/decorative articles of wood (including inlay work, casks, barrel, vats) 12 27/07/2018
4417 Tools, tool bodies, tool handles, broom or brush bodies and handles, of wood; boot or shoe lasts and trees, of wood 12 28/06/2017
4401 Firewood or fuel wood NIL 28/06/2017
4401 Wood in chips or particles; sawdust and wood waste and scrap, whether or not agglomerated in logs, briquettes, pellets or similar forms 5 28/06/2017
4403 Wood in the rough 18 28/06/2017
4404 Hoopwood; split poles; piles, pickets and stakes of wood, pointed but not sawn lengthwise; wooden sticks, roughly trimmed but not turned, bent or otherwise worked, suitable for the manufacture of walkingsticks, umbrellas, tool handles or the like 12 28/06/2017
4406 Railway or tramway sleepers (crossties) of wood 12 28/06/2017
4407 Wood sawn or chipped 18 28/06/2017
4408 Sheets for veneering (including those obtained by slicing laminated wood), for plywood or for similar laminated wood and other wood, sawn lengthwise, sliced or peeled, whether or not planed, sanded, spliced or end-jointed, of a thickness not exceeding 6 mm [for match splints] 12 28/06/2017
4408 Sheets for veneering (including those obtained by slicing laminated wood), for plywood or for similar laminated wood and other wood, sawn lengthwise, sliced or peeled, whether or not planed, sanded, spliced or end-jointed, of a thickness not exceeding 6 mm [other than for match splints] 18 28/06/2017
4409 Wood (including strips and friezes for parquet flooring, not assem-bled) continuously shaped (tongued, grooved, rebated, chamfered, v-jointed, beaded, moulded, rounded or the like) along any of its edges or faces, whether or not planed, sanded or end-jointed [other than bamboo flooring inserted on 27/07/2018] 18 28/06/2017
4409 Bamboo flooring 12 27/07/2018
4410 Particle board, Oriented Strand Board (OSB) and similar board (for example, wafer board) of wood or other ligneous materials, whether or not agglomerated with resins or other organic binding substances, other than specified boards 18 14/11/2017
4411 Fibre board of wood or other ligneous materials, whether or not bonded with resins or other organic substances, other than specified boards 18 14/11/2017
4412 Plywood, veneered panels and similar laminated wood 18 14/11/2017
4414 Wooden frames for painting, photographs, mirrors etc 12 27/07/2018
4415 Packing cases, boxes, crates, drums and similar packings, of wood; ca- ble-drums of wood; pallets, box pallets and other load boards, of wood; pallet collars of wood 12 28/06/2017
4416 Casks, barrels, vats, tubs and other coopers’ products and parts thereof, of wood, including staves 12 28/06/2017
4418 Builders’ joinery and carpentry of wood, including cellular wood panels, assembled flooring panels, shingles and shakes 18 14/11/2017
4419 Tableware and Kitchenware of wood 12 22/09/2017
4420 Wood marquetry and inlaid wood; caskets and cases for jewellery or cutlery, and similar articles, of wood; statuettes and other ornaments, of wood; wooden articles of furniture not falling in Chapter 94 12 28/06/2017
4420 Statuettes & other ornaments of wood, wood marquetry & inlaid, jewellery box, wood lathe and lacquer work [including lathe and lacquer work, ambadi sisal craft] 12 27/07/2018
4421 Other articles of wood; such as clothes hangers, Spools, cops, bobbins, sewing thread reels and the like of turned wood for various textile machinery, Match splints, Pencil slats, Parts of wood, namely oars, paddles and rudders for ships, boats and other similar floating structures, Parts of domestic decorative articles used as tableware and kitchenware [other than Wood paving blocks, articles of densified wood not elsewhere included or specified, Parts of domestic decorative articles used as tableware and kitchenware] 12 28/06/2017
4421 Wood paving blocks, articles of densified wood not elsewhere included or specified, Parts of domestic decorative articles used as tableware and kitchenware 18 14/11/2017
4421 Carved wood products, art ware/decorative articles of wood (including inlay work, casks, barrel, vats) 12 27/07/2018
44 Idols of wood 12 22/09/2017
4402 Wood charcoal (including shell or nut charcoal), whether or not agglomerated NIL 28/06/2017
44 The following goods, namely: — a. Cement Bonded Particle Board; b. Jute Particle Board; c. Rice Husk Board; d. Glass-fibre Reinforced Gypsum Board (GRG) e. Sisal-fibre Boards; f. Bagasse Board; and g. Cotton Stalk Particle Board h. Particle/fibre board manufactured from agricultural crop residues 12 28/06/2017
44 Deities made of stone, marble or wood NIL 27/07/2018
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Can health insurance and motor insurance payment invoices be considered as service bills They attract 12+% GST and be used for LTC encash claim

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This was already answered at Can health insurance premium receipt be produced on the bills against LTC Package Scheme?

Can I purchase plywood, and paints,and electrical switches under LTC cash back offer?