Composite Transfer Grant

The Composite Transfer Grant is 80% of last month's basic pay on a transfer of 20 km or more, and on retirement settlement, under the 7th CPC TA rules.

Updated 17 July 2026 · Reviewed by Salary-Calculator.in

The Composite Transfer Grant (CTG) is a lump-sum payment made to a central government employee on transfer, or on settlement after retirement, to meet the cost of packing, local transport and the incidentals of shifting home. Under the 7th Central Pay Commission it is 80 per cent of the last month’s basic pay where the transfer involves a change of station and the two stations are 20 km or more apart. It is granted under the Department of Expenditure travelling-allowance rules, by Office Memorandum F.No. 19030/1/2017-E.IV dated 13 July 2017.

This article covers the grant in full: what it is and where it sits within the four components of transfer travelling allowance, the 80 per cent rate and the 20 km distance rule, the higher 100 per cent rate for the island territories, the one-third rate for short-distance and same-city moves, the exclusion of dearness allowance, Non-Practising Allowance and Military Service Pay from the basic pay figure, the husband-and-wife rule, the treatment on retirement and the removal of the 20 km condition from 6 January 2022, the documentation, and worked examples.

CTG is one of the most valuable single payments an employee receives on a posting, because it is worked out on basic pay and paid as a lump sum rather than against bills. For a mid-career officer a transfer can put close to a month’s basic pay in hand for the move, which is why the rate, the distance rule and the exclusions repay careful reading.

Where CTG sits: the four components of transfer TA

When a government servant is transferred in the public interest, the travelling allowance paid on transfer is not a single payment but a bundle of four distinct components, each with its own rule:

Travel entitlement for self and family, the fare for the employee and the family to travel from the old station to the new one, by the class of travel the employee is entitled to.
The Composite Transfer Grant, the lump sum that is the subject of this article, covering packing, local transport and incidentals.
Reimbursement of the cost of transporting personal effects, the freight for the household goods, on the prescribed weight scales by rail or road.
Reimbursement of the cost of transporting a conveyance, the charge for moving a car or a two-wheeler.

CTG is the second of these, and it is distinct from the third. A common confusion is to expect CTG to cover the freight on the household goods; it does not. The freight is reimbursed separately against the transport component, while CTG is a flat grant for the packing and the local cartage and the incidental expenses that no bill captures. The travelling allowance article covers the other three components; this one covers CTG.

The 80 per cent rate and the 20 km rule

The core rule is short. CTG is paid at 80 per cent of the last month’s basic pay where a transfer involves a change of station and the old and new stations are located 20 km or more from each other. “Last month’s basic pay” means the basic pay drawn in the month before the move, that is the pay in the level of the pay matrix , and 80 per cent of it is the grant.

The 20 km test is a test of genuine relocation. A transfer between two stations far apart plainly involves shifting the household, and the full grant follows. The distance threshold exists to separate a real move from a nominal change of office that does not uproot the family, which is dealt with by the one-third rule below.

Under the 6th Central Pay Commission the composite transfer grant was equal to one full month’s basic pay. The 7th Central Pay Commission reduced the rate to 80 per cent of a month’s basic pay, in line with its general rationalisation of allowances, while keeping the structure of the grant intact. So an employee transferred today receives four-fifths of a month’s basic pay, not a whole month’s, as CTG.

The island territories: 100 per cent

The rate rises for the hardest moves. For a transfer to or from the island territories of Andaman, Nicobar and Lakshadweep, CTG is paid at 100 per cent of the last month’s basic pay, not 80 per cent. Moving a household to or from the islands is costlier and harder than a move on the mainland, involving sea or air transport of goods and longer disruption, and the full month’s basic pay recognises that. The higher rate applies to a move in either direction, to the islands or away from them. This sits alongside the other island-posting benefits, such as the island special duty allowance paid for serving there.

Short-distance and same-city transfers: one-third

Not every transfer uproots the family, and the grant scales down when the move is short. Where a transfer is to a station less than 20 km from the old one, or is a transfer within the same city, one-third of the Composite Transfer Grant is admissible, and only if a change of residence is actually involved. Two conditions therefore have to be read together:

The move is short, under 20 km or within the same city, so one-third rather than the full grant applies.
A change of residence must actually take place. If the employee continues to live in the same house and only the office changes, no CTG at all is payable, because there is nothing to pack and shift.

The one-third figure is one-third of the 80 per cent grant, not one-third of basic pay. So for an employee whose basic pay is Rs. 60,000, the full CTG would be 80 per cent, or Rs. 48,000, and the one-third short-distance grant is Rs. 16,000. The change-of-residence condition is documented by a declaration, discussed below.

Dearness allowance, NPA and MSP are excluded

CTG is a percentage of basic pay, and nothing else. The point matters because employees sometimes assume the grant is worked out on gross pay. It is not. Dearness allowance is not part of basic pay for CTG, so the grant does not swell with the dearness allowance rate. And the orders go further and specifically exclude two components that are otherwise sometimes treated as part of pay:

Non-Practising Allowance in the case of a medical officer, and
Military Service Pay in the case of defence personnel,

are both left out of the basic pay figure used to work out CTG. A doctor on the Central Health Service whose pay slip shows basic pay plus NPA has the CTG worked out on the basic pay alone, ignoring the NPA, and a defence officer’s CTG ignores the MSP. This keeps the grant tied to the core pay of the level and prevents the pay-linked allowances from inflating it.

The husband-and-wife rule

Where a husband and wife are both government servants and both are transferred, the grant is not paid twice in full for a single household move. The rule turns on the gap between the two transfers:

If both transfers are ordered within 60 days of each other, the spouse transferred later receives no transfer grant. The family shifts once, so the grant is paid once, to the spouse transferred first.
If the transfers are more than 60 days apart but fall within six months of each other, the spouse transferred later receives 50 per cent of the transfer grant.

The reasoning is that a single relocation of the household should not attract two full grants. The first-transferred spouse draws the full CTG for the move; the second draws nothing or half, depending on the timing.

When CTG is not admissible

CTG follows the logic of a public-interest transfer, and it falls away where that logic does not hold. The grant is not admissible in four situations:

No change of residence. If the transfer does not result in the employee actually shifting home, no CTG is paid, whatever the distance, because there is nothing to pack and move.
A temporary transfer of 180 days or less. CTG is meant for a substantive move, so a temporary transfer not exceeding 180 days does not attract it. A posting long enough to require shifting the household, beyond 180 days, is treated as a proper transfer.
A transfer at the employee’s own request. Where the transfer is ordered at the request of the employee, for personal convenience rather than administrative need, CTG is not admissible. The grant compensates a move the government requires, not one the employee sought.
Where the pay and distance conditions are not met, that is a move under 20 km without a change of residence, which draws nothing rather than the one-third grant.

One procedural point protects the employee. For CTG to be denied on the “own request” or “temporary transfer” grounds, the transfer order itself must positively say so. In the absence of any statement in the transfer order that the move is at the employee’s request, or that it is for a period of 180 days or less, the transfer is treated as a public-interest transfer and CTG is admissible. So the wording of the transfer order is decisive, and an employee should read it for any “at own request” endorsement that would bar the grant.

The whole travelling-allowance-on-transfer framework, of which CTG is one part, rests on the Fundamental Rules 113 to 117 and the Supplementary Rules, with the family for travelling-allowance purposes defined in Supplementary Rule 2, and the post-7th CPC rates consolidated in the Department of Expenditure order of 13 July 2017.

CTG on retirement and the 2022 change

CTG is not only a transfer benefit. A retiring employee who settles down after retirement is treated, for this purpose, much like an employee on transfer, because settling after a career in government service is itself a relocation. On retirement the grant is paid at 80 per cent of the last month’s basic pay, provided a change of residence is actually involved.

The rule for a retiree settling at or near the last station of duty was liberalised. Earlier, a retiree who settled at the last station of posting, or within 20 km of it, received only one-third of the CTG, the same short-distance treatment as a serving employee, while a retiree who settled 20 km or more away received the full 80 per cent. That distinction was removed. With effect from 6 January 2022, in partial modification of the 2017 order, the 20 km condition was done away with for retirees: full CTG at 80 per cent of the last month’s basic pay is now admissible even where the retiree settles down at the last station of duty, subject only to a change of residence actually taking place. The retiree files a self-declaration certificate of change of residence in the prescribed format.

So a person retiring today and staying in the same city, but shifting from government or rented accommodation to their own home, now draws the full 80 per cent CTG, where before 2022 they would have drawn one-third. This is one of the more valuable recent liberalisations for a retiring employee, and it interacts with the wider retirement and pension settlement, since CTG is paid along with the other settlement dues.

Documentation and payment

CTG is a grant, but it is not entirely free of proof. The change of residence is the fact that has to be established, and the employee or retiree files a self-declaration to that effect. Where personal effects are moved by the employee’s own arrangement rather than through an official facility, documentary evidence of the transport need not be insisted upon for the CTG itself, because CTG is a composite grant and not a reimbursement of the freight.

The transfer incidentals and the road mileage for the journeys between the residence and the railway station or bus stand, at both the old and the new station, are subsumed in CTG and are not separately admissible. That is the sense in which the grant is “composite”: it rolls the packing, the local cartage and these incidental journeys into one figure, so the employee does not file a string of small claims.

On retirement, the claim for full settlement of CTG is entertained and paid along with the settlement dues, once the retiree has finally transported the personal effects and submitted the necessary proof, so the grant reaches the retiree with the rest of the retirement payments.

CTG for the family of an employee who dies in service

The relocation that CTG compensates does not always follow a transfer or a retirement. When a government servant dies in service, the family has to move from the station of the last posting, often back to a home town, and they too face the packing, cartage and incidental costs the grant is meant to meet. The family of an employee who dies in service is therefore entitled to the travelling allowance on settlement, including the Composite Transfer Grant, for the journey and the shift of the household to the place they choose to settle.

The grant to the family is worked out on the same basis as for a retiring employee, on the last month’s basic pay of the deceased, and it is paid as part of the death-related settlement alongside the other dues to the family. This treatment matters because it puts a substantial lump sum in the hands of a bereaved family at exactly the point they must uproot and relocate, and it sits within the wider set of death-in-service benefits, the family pension and the retirement gratuity among them, that support the family after the loss.

Worked examples

The figures below assume the transfer involves a genuine change of residence, and use the last month’s basic pay only.

Situation	Last month’s basic pay	Rate	CTG
Transfer, stations 400 km apart	Rs. 44,900	80 per cent	Rs. 35,920
Transfer, stations 400 km apart	Rs. 78,800	80 per cent	Rs. 63,040
Transfer to the Andaman Islands	Rs. 56,100	100 per cent	Rs. 56,100
Transfer within the same city, change of residence	Rs. 60,000	One-third of 80 per cent	Rs. 16,000
Retirement, settling in a different city	Rs. 1,12,400	80 per cent	Rs. 89,920
Retirement, settling at the last station (from 6 January 2022)	Rs. 1,12,400	80 per cent	Rs. 89,920

The last two rows show the effect of the 2022 change: before it, the retiree settling at the last station would have received one-third, or about Rs. 29,973, and now receives the full Rs. 89,920.

Why the grant is “composite”

The word “composite” is not decorative; it records what the grant replaced. A government transfer imposes many small, hard-to-document costs: packing materials and labour, the cartage of goods from the house to the loading point, the short local journeys of the family between the residence and the station at each end, and a spread of incidental expenses that no single bill captures. In the older rules these were dealt with through separate heads, a packing allowance and transfer incidentals among them, each claimed on its own and each generating paperwork out of proportion to the sums involved.

The composite grant rolled all of that into one figure fixed as a percentage of pay. Instead of claiming a packing allowance, then the local cartage, then the transfer incidentals separately, the employee draws a single lump sum that is deemed to cover them all. This is why the transfer incidentals and the road mileage between the residence and the station at both ends are subsumed in CTG and are not separately admissible: they are already inside the composite figure. The design trades precise reimbursement of each small cost for the simplicity of one pay-linked grant, which suits a payment where the individual items are small, numerous and awkward to prove.

The rate has moved with the pay commissions. Under the 6th Central Pay Commission the composite transfer grant was one full month’s basic pay. The 7th Central Pay Commission reduced it to 80 per cent of a month’s basic pay as part of its general trimming of allowances, while leaving the composite structure and the distance and residence conditions unchanged. The family that may travel and shift at government cost on a transfer is defined for travelling-allowance purposes in the Supplementary Rules, and covers the spouse, dependent children and certain dependent relatives, so the grant is set against a genuine household move rather than the employee alone.

The tax position

The Composite Transfer Grant is a payment to meet the cost of an official transfer, and to the extent it is actually spent on the transfer it is not a perquisite in the employee’s hands. In practice CTG paid on an official transfer, along with the other transfer travelling-allowance components, is treated as meeting the actual cost of the move and is not taxed as income, provided it is spent on the transfer, since it is a reimbursement in substance rather than a reward. The position should be confirmed for an individual case with the drawing and disbursing officer and a tax adviser, and the income tax for government employees article covers how transfer payments interact with salary.

The 8th CPC outlook

The 7th Central Pay Commission cut the grant from a full month’s basic pay to 80 per cent, and the government later liberalised the retirement rule from 2022. Whether the 8th Central Pay Commission restores the full month, keeps 80 per cent, or changes the distance and settlement rules is not known, and no figure for CTG after the 8th CPC can be stated as fact until that commission reports and its recommendations are accepted. Until then the position is 80 per cent of the last month’s basic pay, 100 per cent for the island territories, one-third for a short move with a change of residence, and full CTG on retirement without the 20 km condition.

Frequently Asked Questions (FAQs)

What is the Composite Transfer Grant and how much is it?

The Composite Transfer Grant (CTG) is a lump-sum payment made to a central government employee on transfer, to meet the packing, local transport and incidental costs of shifting home. Under the 7th Central Pay Commission it is 80 per cent of the last month’s basic pay, where the transfer involves a change of station and the two stations are 20 km or more apart. It is one of the four components of the travelling allowance paid on transfer.

Is CTG paid on retirement?

Yes. A retiring employee who settles down after retirement receives CTG on the same basis as a serving employee on transfer, that is 80 per cent of the last month’s basic pay, provided a change of residence is actually involved. With effect from 6 January 2022 the condition that the new place be 20 km or more from the last station of duty was removed for retirees, so full CTG is now admissible even for settlement at the last station of duty, on a self-declaration of change of residence.

What is the CTG for a transfer within the same city or under 20 km?

One-third of the Composite Transfer Grant is admissible for a transfer to a station less than 20 km from the old one, or a transfer within the same city, provided a change of residence is actually involved. If no change of residence takes place, no CTG is payable, because the grant is meant to meet the cost of shifting home.

Is CTG higher for the island territories?

Yes. For a transfer to or from the island territories of Andaman, Nicobar and Lakshadweep, CTG is paid at 100 per cent of the last month’s basic pay instead of 80 per cent, in recognition of the greater cost and difficulty of moving to and from the islands.

Are dearness allowance, NPA and MSP counted in basic pay for CTG?

No. CTG is a percentage of basic pay alone, the pay drawn in the level of the pay matrix. Dearness allowance is not part of basic pay for this purpose, and the orders specifically exclude Non-Practising Allowance and Military Service Pay from the basic pay figure used to work out CTG.

What happens to CTG when a husband and wife are both government servants and both transferred?

Where the transfers of a husband and wife take place within six months of each other but more than 60 days apart, the spouse transferred later gets 50 per cent of the transfer grant. Where both transfers are ordered within 60 days of each other, the spouse transferred later gets no transfer grant, because the family shifts once and the grant is not paid twice for the same move.

Does CTG cover the cost of transporting my household goods?

No, that is a separate component. CTG covers packing, local cartage, transfer incidentals and the road mileage between the residence and the railway station or bus stand at both ends. The actual freight for transporting household effects, and the transport of a car or two-wheeler, are reimbursed separately under the other components of transfer travelling allowance, on the prescribed scales.

External references

References

Ministry of Finance, Department of Expenditure, Office Memorandum No. 19030/1/2017-E.IV dated 13 July 2017, “Travelling Allowance Rules, Implementation of the recommendations of the Seventh Central Pay Commission” (Composite Transfer Grant at 80 per cent of last month’s basic pay on transfer involving a change of station 20 km or more apart; 100 per cent for the island territories; one-third for transfers under 20 km or within the same city with a change of residence; NPA and MSP excluded from basic pay).
Ministry of Finance, Department of Expenditure, Office Memorandum in partial modification of the order dated 13 July 2017, with effect from 6 January 2022 (removal of the 20 km condition for Composite Transfer Grant on retirement; full CTG admissible for settlement at the last station of duty on a self-declaration of change of residence).
Report of the Seventh Central Pay Commission, November 2015, chapter on travelling allowance (recommendation to pay the Composite Transfer Grant at 80 per cent of last month’s basic pay, reduced from a full month’s basic pay under the 6th Central Pay Commission).
Ministry of Finance, Department of Expenditure, clarificatory Office Memorandum dated August 2017 on the 7th CPC transfer travelling-allowance rules (four components of transfer TA; husband-and-wife rule; documentation for transport of personal effects).
Ministry of Railways (Railway Board), Indian Railway Establishment Code provisions on the Composite Transfer Grant (parallel application of the 7th CPC CTG rules to railway servants, including the conditions for grant on retirement).