Section 10(14)(i) under new tax regime: Wrong claims can trigger income tax notices, warns tax expert
While taxpayers under the new tax regime have limited opportunities to claim exemptions, Section 10(14)(i) remains available for specified allowances provided by employers to meet official work-related expenses. The benefit applies only to actual expenditure supported by the law and not to arbitrary claims made while filing returns.
- Aug 2, 2026,
- Updated Aug 2, 2026 7:10 AM IST
Taxpayers opting for the new income tax regime should exercise caution while claiming exemptions under Section 10(14)(i), as incorrect claims could invite notices from the Income Tax Department, according to tax expert Sujit Bangar, Founder of TaxBuddy.
In a series of posts on X, Bangar said many taxpayers are incorrectly treating Section 10(14)(i) as a general exemption for salary components. However, the provision is narrowly defined and applies only to specified employer-paid allowances that are directly linked to official duties.
"Under the new tax regime, people claim Section 10(14)(i) exemption for anything. Wrong claims can lead to tax notices," Bangar said, urging taxpayers to understand the scope of the provision before filing their returns.
What does Section 10(14)(i) cover?
Section 10(14)(i) of the Income Tax Act exempts special allowances granted by employers to salaried employees to meet expenses incurred while performing official duties. The exemption is available only up to the amount actually spent and only when the expenditure is incurred wholly, necessarily and exclusively for employment-related responsibilities.
Tax experts note that while these allowances have traditionally been available under the old tax regime, specified allowances covered under Section 10(14)(i) continue to remain available under the new tax regime (Section 115BAC) because they reimburse genuine work-related expenses. Simply reporting an expense in the income tax return does not make it eligible for exemption.
Bangar also pointed out that although most exemptions such as Section 80C, Section 80D and House Rent Allowance (HRA) are unavailable under the new tax regime, Section 10(14)(i) continues to survive for eligible work-related expenses. However, exemptions covered under Section 10(14)(ii) are not available under the new regime.
Allowances eligible under Section 10(14)(i)
The exemption generally applies to certain employer-paid allowances, including:
| Allowance | Purpose |
|---|---|
| Travelling allowance | Expenses incurred during official tours or transfers |
| Daily allowance | Daily expenses during official travel |
| Conveyance allowance | Official travel undertaken for work |
| Helper allowance | Salary paid to a helper engaged for official duties |
| Uniform allowance | Purchase and maintenance of official uniform |
| Research/Academic allowance | Research and academic work related to employment |
ALSO READ: Over 1 lakh Zomato, Blinkit delivery partners file ITRs; Rs 18 crore in tax refunds facilitated
Exemption is available only for actual expenditure
Bangar stressed that taxpayers cannot claim the exemption merely because an allowance appears in their salary structure. The amount must have actually been spent for the intended official purpose.
For example, an employee receiving conveyance allowance must have incurred expenses on official travel. Similarly, uniform allowance is exempt only if the employee actually purchases or maintains the prescribed uniform, while helper allowance requires proof that a helper was engaged and paid for official work.
According to Bangar, one of the biggest mistakes this filing season has been taxpayers claiming ₹50,000 as conveyance allowance without undertaking official travel, claiming helper allowance despite not employing a helper, or seeking exemptions without maintaining any documentary evidence.
| What You Can Claim | Conditions for Exemption |
|---|---|
| Travel/Tour Allowance | Must be spent on official travel or transfer |
| Daily Allowance | For daily expenses incurred during official tours |
| Conveyance Allowance | Only for official duty-related travel |
| Uniform Allowance | Must be used to purchase or maintain prescribed work uniforms |
| Helper Allowance | Helper must be engaged and paid for official duties |
| Research/Academic Allowance | Must be incurred for professional research or academic work |
| Key Rule | Exemption is available only to the extent of actual expenditure incurred for official duties and supported by relevant documents. |
Common mistakes under the new tax regime
According to Bangar, some of the most common incorrect claims include claiming conveyance allowance despite having no official travel, claiming helper allowance without employing a helper, or seeking exemption without maintaining bills or supporting documents.
He also highlighted that while Section 10(14)(i) remains available under the new tax regime (Section 115BAC), exemptions under Section 10(14)(ii) are not available.
What happens if the claim is incorrect?
An ineligible claim can be disallowed by the Income Tax Department during processing or scrutiny.
| Incorrect claim may result in | Impact |
|---|---|
| Exemption disallowed | Amount added back to taxable income |
| Additional tax liability | Tax payable as per applicable slab |
| Interest and penalty | Applicable under the Income-tax Act |
| Income tax notice | Notice under Section 143(1) or scrutiny under Section 143(3) |
To substantiate a genuine claim, taxpayers should preserve the employer's allowance certificate, bills, receipts, travel records, uniform purchase invoices and proof of helper payments, wherever applicable. Tax experts say proper documentation remains the key to successfully claiming Section 10(14)(i) benefits while avoiding disputes during return processing or assessment.
Taxpayers opting for the new income tax regime should exercise caution while claiming exemptions under Section 10(14)(i), as incorrect claims could invite notices from the Income Tax Department, according to tax expert Sujit Bangar, Founder of TaxBuddy.
In a series of posts on X, Bangar said many taxpayers are incorrectly treating Section 10(14)(i) as a general exemption for salary components. However, the provision is narrowly defined and applies only to specified employer-paid allowances that are directly linked to official duties.
"Under the new tax regime, people claim Section 10(14)(i) exemption for anything. Wrong claims can lead to tax notices," Bangar said, urging taxpayers to understand the scope of the provision before filing their returns.
What does Section 10(14)(i) cover?
Section 10(14)(i) of the Income Tax Act exempts special allowances granted by employers to salaried employees to meet expenses incurred while performing official duties. The exemption is available only up to the amount actually spent and only when the expenditure is incurred wholly, necessarily and exclusively for employment-related responsibilities.
Tax experts note that while these allowances have traditionally been available under the old tax regime, specified allowances covered under Section 10(14)(i) continue to remain available under the new tax regime (Section 115BAC) because they reimburse genuine work-related expenses. Simply reporting an expense in the income tax return does not make it eligible for exemption.
Bangar also pointed out that although most exemptions such as Section 80C, Section 80D and House Rent Allowance (HRA) are unavailable under the new tax regime, Section 10(14)(i) continues to survive for eligible work-related expenses. However, exemptions covered under Section 10(14)(ii) are not available under the new regime.
Allowances eligible under Section 10(14)(i)
The exemption generally applies to certain employer-paid allowances, including:
| Allowance | Purpose |
|---|---|
| Travelling allowance | Expenses incurred during official tours or transfers |
| Daily allowance | Daily expenses during official travel |
| Conveyance allowance | Official travel undertaken for work |
| Helper allowance | Salary paid to a helper engaged for official duties |
| Uniform allowance | Purchase and maintenance of official uniform |
| Research/Academic allowance | Research and academic work related to employment |
ALSO READ: Over 1 lakh Zomato, Blinkit delivery partners file ITRs; Rs 18 crore in tax refunds facilitated
Exemption is available only for actual expenditure
Bangar stressed that taxpayers cannot claim the exemption merely because an allowance appears in their salary structure. The amount must have actually been spent for the intended official purpose.
For example, an employee receiving conveyance allowance must have incurred expenses on official travel. Similarly, uniform allowance is exempt only if the employee actually purchases or maintains the prescribed uniform, while helper allowance requires proof that a helper was engaged and paid for official work.
According to Bangar, one of the biggest mistakes this filing season has been taxpayers claiming ₹50,000 as conveyance allowance without undertaking official travel, claiming helper allowance despite not employing a helper, or seeking exemptions without maintaining any documentary evidence.
| What You Can Claim | Conditions for Exemption |
|---|---|
| Travel/Tour Allowance | Must be spent on official travel or transfer |
| Daily Allowance | For daily expenses incurred during official tours |
| Conveyance Allowance | Only for official duty-related travel |
| Uniform Allowance | Must be used to purchase or maintain prescribed work uniforms |
| Helper Allowance | Helper must be engaged and paid for official duties |
| Research/Academic Allowance | Must be incurred for professional research or academic work |
| Key Rule | Exemption is available only to the extent of actual expenditure incurred for official duties and supported by relevant documents. |
Common mistakes under the new tax regime
According to Bangar, some of the most common incorrect claims include claiming conveyance allowance despite having no official travel, claiming helper allowance without employing a helper, or seeking exemption without maintaining bills or supporting documents.
He also highlighted that while Section 10(14)(i) remains available under the new tax regime (Section 115BAC), exemptions under Section 10(14)(ii) are not available.
What happens if the claim is incorrect?
An ineligible claim can be disallowed by the Income Tax Department during processing or scrutiny.
| Incorrect claim may result in | Impact |
|---|---|
| Exemption disallowed | Amount added back to taxable income |
| Additional tax liability | Tax payable as per applicable slab |
| Interest and penalty | Applicable under the Income-tax Act |
| Income tax notice | Notice under Section 143(1) or scrutiny under Section 143(3) |
To substantiate a genuine claim, taxpayers should preserve the employer's allowance certificate, bills, receipts, travel records, uniform purchase invoices and proof of helper payments, wherever applicable. Tax experts say proper documentation remains the key to successfully claiming Section 10(14)(i) benefits while avoiding disputes during return processing or assessment.