International · allowance
Deputation allowance
Allowances paid on deputation follow the purpose test: exempt to the extent they meet actual official expenditure.
How the taxable value is determined
Amounts meeting travel, transfer or daily expenses on official deputation are exempt to the extent incurred under Rule 2BB(1). A flat deputation allowance beyond actual expenditure is taxable salary.
Regime availability
- Old regime
- Available
- New regime
- Available
Documentation to keep
Deputation order and expense records.
Legal basis: Rule 2BB(1), Income-tax Rules
Frequently asked questions
Is deputation allowance taxable in India?
Allowances paid on deputation follow the purpose test: exempt to the extent they meet actual official expenditure. Amounts meeting travel, transfer or daily expenses on official deputation are exempt to the extent incurred under Rule 2BB(1). A flat deputation allowance beyond actual expenditure is taxable salary.
Does the exemption apply under the new tax regime?
Under the old regime this treatment is available; under the new regime it is available. Legal basis: Rule 2BB(1), Income-tax Rules.
What records should I keep for deputation allowance?
Deputation order and expense records.
Related tools & guides
Reflects provisions in force for FY 2026-27; verify against the latest government publications (incometax.gov.in). Information, not tax advice.