CA Sandeep Kanoi

CA Sandeep KanoiEarned leave means the leave accrued to the employee in proportion of the work done by him.  This varies from employer to employer.  For example in government sector, the earned leave is 2.5 days for every month worked.  This 2.5 days is granted with a view to provide him rest to enable him to recover from the stess and strain endured by him during the course of his work.  This can be accumulated and either taken in the subsequent months or encashed as per the rules extant in force. If leave standing to the employee’s credit is not taken within a year, as per the service rules, it may lapse or it may be encashed or it may be accumulated. The employee can avail the accumulated leave during his service tenure or it can be encashed at the time of retirement or leaving the job. Encashment of leave by surrendering leave standing to one’s credit is known as leave salary.  The taxation of Leave salary for various categories of employees is shown here under:

Status of Employee

Nature of Leave Encashment

Taxability

Government/ Non-Government employee Leave encashment during Continuity of employment It is chargeable to tax. However relief can be taken under section 89
Government employee Leave encashment at the time of retirement / leaving job It is fully exempt from tax under section 10(10AA)(i)
Non-Government employee Leave encashment at the time of retirement / leaving job It is fully or partially exempt from tax in some cases under section 10(10AA)(ii)

In Simple words from the above tabloid summary we can conclude that Leave Salary is chargeable to tax only in two cases first accumulated leave being enchased by any class of employee- Govt. or Non Govt. during the continuation of employment whereof it is fully chargeable to tax.

Second being accumulated leaves enchased by a non govt. employee on his/ her retirement whereof the complicated part of calculation of exempted leave salary comes into picture which can be calculated as LEAST of the following:

a. Cash equivalent of the leave salary in respect of the period of earned leave standing to the credit of employee at the time to retirement/superannuation (earned leave entitlements cannot exceed 30 days for every year of actual service rendered for the employer from whose service he has retired); (See Note- 1)

b. 10 months’ ‘average salary’; (See Note- 2)

c. Rs. 3 lakh (applicable from 01.04.1998);

d. The amount of leave encashment actually received at the time of retirement.

Note- 1

How to find out leave standing to the credit of an employee at the time of retirement or leaving the job

Step (a) – Find out duration of services in number of years (ignore any fraction of year).

Step (b) – Find out rate of earned leave entitlement from the service rules – how many days leave is credited at the rendered for each year of services (earned leave entitlement can not exceed 30 days for every year of actual services rendered for the employer from whose services he has retired).

For instance, if earned leave is credited at the rate of 45 days leave for each year of service, for step (b) calculation shall be made at the rate of 30 days leave for each year of service. If, however, earned leave is credited at the rate of 23 days leave for each year of service, for step (b) calculation shall be made at the rate of 23 days leave for each year of service.

Step (c) – Find out earned leave actually taken or enchased (in number of days) during the service time, the computation shall be made as follows:-

Step (a) × Step (b) minus Step (c) ÷ 30

Note- 2

How to find out Average monthly salary?

Salary, for this purpose, means basic salary and includes dearness Allowance if terms of employment so provide. It also includes commission based upon fixed percentage of turnover achieved by an employee, (if any). ‘Average Salary’ for the aforesaid purpose is to be calculated on the basis of average salary drawn during the period of 10 months ending on the date of retirement.

Other relevant points

  • Here, Average Salary is to be calculated on the basis of average salary drawn during the period of 10 months immediately preceding the retirement or superannuation.   Salary means last drawn salary and includes basic salary + Dearness Allowance (if terms of employment so provide) + Commission based on a fixed % of turnover.
  • Where the cash equivalent of unutilised earned leave is received by an employee from two or more employers in the same year, or different years, the maximum amount exempt from tax shall not exceed the amount specified by the Government i.e., Rs. 3,00,000/-.
  •   Salary paid to legal heirs of the deceased employee in respect of privilege leave standing to the credit of such employee at the time of his/her death is not taxable as salary.
  •   Sum equivalent of leave salary received by the family of a government servant who died in harness, is not taxable in the hands of the recipients.
  • In case of Non-Government employee, Leave Salary received on Resignation or Retrenchment is taxable. Of course, relief u/s. 89 r.w.rule 21A would be admissible. However, Leave Salary received on Voluntary Retirement or Compulsory Retirement is exempt u/s.10(10AA) (ii) to the extent specified therein. The scope of said section is extended to Leave encashment at the time of retirement whether such retirement is on superannuation or otherwise. The word “otherwise” covers  the case of  Voluntary Retirement from service as held by Madras High Court in CIT vs. R V Shahney (159 ITR 160).

Download- Leave Salary encashment calculator

(Republished with amendments)

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91 responses to “Leave Salary encashment Exemption, Calculation, Download calculator”

  1. ajay arya says:

    sir kindly read it as that tax liability has not shown any decrease.

  2. ajay arya says:

    sir retired from pnb. I have to request to kindly inform under which head rupees 3 lacs to be shown for exemption under leave encashment. I have filled in the form by adding the entire income as per 26 AS in my return and shown below rupees 3 lacs under section 10aa but tax liability has now decreased. Kindly guide under which coloumn rupees 3 lacs to be fillied in to take benefit of rupees 3 lacz

  3. Sunil kumar says:

    Please tell me is any amount of salary for last month excluded from salary for leave encashment reg bank retired

    • L N Rahul says:

      At the time of retirement 240 days leave was accumulated which was for last 8 year and for this leave encashment was paid.In income tax return whether i can avail benifit of section 89(1) because leave was for previous year for which encashment was paid.

  4. Sunil kumar says:

    If any amount exclude from last month salary of employee
    Mean part of the salary in encashment or the calculation based on average salary or last month salary for 240 days
    For bank employee kindly advice me because i retd from uco bank in may 31 2017 and bank procedure for 240 days
    Encasment bank excluding cca from my salary and up
    To what amount taxation liability

  5. Ashok Sharma says:

    I had been retired from the Govt. Service after attaining the age of 58 years on 30.8.2016. I had received the payment of Leave encashment on the last pay drawn. since , the DA was enhanced after my retirement. Can I entitled for revised leve encashment payment on enhanced DA or otherwise.

  6. Mr. N. Dutta says:

    Sir,
    My uncle retired for S.B.I. & he received leave Encashment salary of Rs.5,20,560/-.Will you Please tell me this income is fully exempt income?

  7. DB DESAI says:

    I retired from SBI on 28/02/17. Leave encashment amount is not paid to me till 31/03/17. It will be paid in 2017-18. The statutory Auditor visited the branch in April 17 and insisting for TDS on the proposed leave encashment amount and changing my from 16 for 2016-17 already issued to me without showing payment of leave encashment and corresponding TDS., Please advise the correct procedure.

  8. Ramanathan says:

    Sir,
    I was absorbed from a Central Govt Autonomous Body to a Central Government subordinate office both under same Department. While releiving from autonomous body my 124 EL were encashed and income tax was deducted. It was also stated that the 124 number of leave shall be deducted from maximum 300 EL that can be encashed at the time of retirement. In such a situation am I supposed to pay income tax on 124 ELs encahsed as this is being deducted from the maximum 300 ELs at the time of retirement, where income tax is not deducted at the time of retirement. pls clarify. thanks.

  9. panday says:

    leave encahment availed earlier can it be added back at the time of retirement if leaves fall short of 300 days

  10. panday says:

    will you please guide an employee who has less than 300 E L but has availed leave encashment on L T C ,can these leaves on encashment be added back at the time of retirement

  11. Amit says:

    Hello Sir,

    I am working with a private MNC. I recently changed my job after working 6 yrs with my previous company. At time of resignation i had some EL’s which are encashed.
    I want to know if the whole amount encashed for the EL’s will be considered taxable OR some part of it will be tax exempted ? My previous company has considered entire amount as taxable saying that only at time of retirement the amount becomes exempted from tax. Can you please help ?

  12. J C TIWARI says:

    I AM WORKING IN PRIVATE CO SINCE 7 YEARS. NOW THEY ARE SAYING ABOUT LEAVE ENCASEMENT IS ONLY ONE MONTH SALARY AS PER COMPANY POLICY, ARE THEY RIGHT? PL ADVICE.

  13. gaurav aggarwal says:

    Dear sir
    I was working with a private company and left job after serving for 2 yrs and 10 months. When i left the job, i had 26 earned leave in my account. I asked for EL encashment but the company refused encashment saying it is done for minimum 5yr old employees only. Pls advise whether it was right or legally i can claim my leave encashment
    Rgds
    Gaurav aggarwal

  14. SANGEETA PULIGADDA says:

    In the equation mentioned in note 1 above, why did you divide by 30? That is the number of days in a month- which rule or law suggests that, I am curious to know

  15. sudhir says:

    i want to show my leave encashment in ITR ,where & which column it has to be shown in ITR &how?

  16. a b dasgupta says:

    I have retd as Nationalised Banks employee on March 2014. My Leave amount was Rs 6,26000 and in the IT returnor FY 2014-15, I have availed relief of Rs 3 Lakh and paid Tax for the remaining 3.26 Lakh. This is apart from other tax Liabilities. In 2015-16, I have received an arrears of Rs 1.4 Lakh towards Leave encashment due to revision of wage in banking industry.
    IS THAT RS 1.4 LAKH TAXABLE ?

  17. R G BHAT says:

    I retired in osu black I got leave encroachment of 659000 calculate tax

  18. kanaiyalal madhvani says:

    I wanted to know whether the provision of leave encashment on retirement for central/State Govt. is applicable to any public sector undertaking like insurance co/nationalised banks employess also ?

    • R.K.Sharma says:

      I was employee of Himachal Pradesh State Electricity Board & retired on 31.05.2015 after completion of service more than 37 years.Above Board incorporated under Company Act,1956 in June 2010 and re-named as Himachal Pradesh State Electricity Board Limited. Now my employer has worked out Rs.73,000/- income tax on my leave encashment received after my retirement with the plea that Board has come under Company act now. Pl clarify whether I am liable to pay this tax now or ortherwise.

      • Shamsher Singh says:

        I am working in H.P. state govt. PSU Forest Dev. Vorpn. I will retire on 28.2.16 and get approx.Rs.7 lac on account of leave salary. Is it taxable.

      • Shamsher Singh says:

        I am working in H.P. state govt. PSU Forest Dev. Corpn. I will retire on 28.2.3017 and get approx.Rs.7 lac on account of leave salary. Is it taxable.

    • GS Subramanian says:

      What is the Maximum Gratuity exempted for Central Govt Employee retires on VR (29 Y 9 M service)

      what is the Maximum Leave Encashment available for Exemption for Central Govt Employee retire on VR

      What is the Maximum Commuted Pension Exempted for Central Govt Employee retires on VR

  19. L Ashokkumar says:

    Sir,

    He was working public sector insurance 30 years completed.He was un expectely died august 2015 his accumulated leaves 238.8/11.He was received salary basic Rs.40460,DA Rs.42907 and FPA Rs.248.5.Kindly advice deceased employee leave encashment tax liablity.

  20. L Ashokkumar says:

    In our employee died (Deceased)but he got Leave encashment Rs.686589/- how much income tax?Kindly advice me.

  21. Amit jain says:

    Sir,

    i have some problem to calculate EL of our employee (died) and detail of his mentioned below:-

    Basic Salary 20419/-
    No. of Service of year 20 yrs with full attendance.
    plz reply me urgently because our HR dept shows his 235.5 EL during his 20 yrs service and he has never took his EL and every year his EL has been added continuously/forwarded to next year.

  22. ajay sareen says:

    I TOOK VOULANTRY RETIREMENT FROM PUBLIC SECTOR IN SEPT 2015.I RECIEVED Rs 628000/ LACS AS LEAVE ENCASHMENT. PLEASE ADVISE HOW MUCH AMOUNT IS EXEMPTED UNDER INCOME TAX ACT.

  23. M.K. Thakur says:

    M.K. Thakur
    1.12.2015 At 13.00 PM
    Sir,
    I retired from the statutory autonomous State Govt. under taking which regulate under the Seeds Act, 1966. Kindly, intimate to me that my Leave Encashmente is taxable ?
    Reply

  24. m.r.sureandran says:

    22/09/1997 to 31/12/1997 uel on mc not received

  25. DIPAK KUMAR GHOSH says:

    I RETIRED FROM BANK’S (STATE BANK OF INDIA) SERVICE ON 31/03/2013 (VOLUNTARY RETIREMENT) AFTER SERVING FROM 26/06/1974 THAT IS 38 YEARS AND 9 MONTHS. I WAS GIVEN A LEAVE ENCASHMENT FOR 55 DAYS ONLY ALTHOUGH ACCORDING TO HRMS IT WAS MORE THAN MORE THAN 240 DAYS. THE CALCULATION SHEET WAS NOT GIVEN TO ME. PLEASE ADVISE ME THE CALCULATION.

  26. Sudipta Chakraborty says:

    Can any employee get EL if he/ she is not complete 1 year of services.

  27. LAD YASHWANT JANARDAN says:

    sir, i have taken VRS from govt bank this year and i have received leave encashment of Rs. 6,57,377/- what will be the tax applied to this encashment.

  28. vijayan says:

    Sir, kindly confirm if an employer can refuse to pay the leave encashment

  29. CA ASHOK kUMAR AGARWAL says:

    Sir,

    I have taken this paragraph from text, given above which needs technical support with SECTION/ CIRCULARE before I claim with department

    Salary paid to legal heirs of the deceased employee in respect of privilege leave standing to the credit of such employee at the time of his/her death is not taxable as salary.

    • Ramalakshmi says:

      an university employee unearned leave (180 days) During his retirement he got a Rs,72,000- tell the details of IT deduction for him.

  30. prabha says:

    Res sir,I m govt highschl teacher in karnataka,I was taken 27 days non payment leave on medical base in sept2014,may it effects on my seniority n increment.shall my seniority goes 1month late.plz advice me.

  31. Syed Lateef Uddin says:

    Respected Sir, I am working as Senior Assistant in Osmania Medical College,Hyderabad Telangana , in Medical and Health Department.

    i am needs to have an clarification in the Lights of the Government orders , That can a employee (Doctor) is eligible for leave encashment after Resignation from Govt Services
    1. Minimum / Maximum How many years of services are required for sanction .

  32. Dinesh Raj says:

    Sir

    May salary is 20000/- CTC per month & deduct PF & admin charges 2600/- & both share & rest of balance in hand salary,
    on EL encasement which amount will be applicable Rs 20000/- or 17400/-

    Please provide me nay link related to government rules.

    Thanks

  33. chandan says:

    I am working in himachal pradesh state lectricity board ltd, a state govt undertaking created under company act 1956 and my friend retired from job on superannuation and received leave encashment rs. 600000 is it taxable or exempt

  34. j.p.gupta says:

    Dear sir, I wish to inform that sir i retired on superannuation in May,2015 from Bank of India and got Rs.8 lacs approx.on account of 240 days leave encashmentafter completion of 37 years of service in the bank.I request you to kindly advise me position of exemption of my encashment. Thanks and regards,

    J.P.GUPTA
    382,Solanipuram,Roorkee Distt.Haridwar ( UttraNCHAL )
    MOBILE NO.09958495940

  35. Pk varma says:

    Retired from pnbank.how much exemption i can claim out of 650000 paid as leave encashment.

  36. saravanan says:

    i resign job jun2015 i want to clime pf in form 15g option assessment year what pls help me

  37. KM Thankachan says:

    Sir,

    I am working in a private Company and will be superannuating (60 years) in a couple of months. I have been working in the present Company for the last 10.5 yrs and there are 124 days Earned Leave to my credit. Am I entitled for tax exemption on these leave encashment at the time of my retirement? Kindly reply to my mail. Regards KM thankachan

  38. S. C. Maheshwari says:

    I retired from UCO Bank (govt of India undertaking) on 31st oct2014, and got leave encashment of Rs4.90lacs,I want to know is full amount of leave encshment is exempted from Income Tax .
    second if taxable , will full amount be added in income and applicable rate may be 20% or 30% will be charged or only 10% rate of IT is applicable irrespective of any income?

  39. Senthil Kumar says:

    I am filing ITR-2 for AY 2015-2016 (FY 2014-2015), I have received a Leave Encashment when I resign my previous job in above mention period. I came to know that Leave Encashment at the time of leaving the job is tax exempted as per sec 10(10AA)(ii). But I could not find the correct column in ITR-2. Please assist me where I can mention 10(10AA)(ii) amount in ITR-2.

  40. S K MISHRA says:

    dear sir,
    I RETIRED FROM SBI IN THE MONTH OF MARCH 2015.I GOT LEAVE ENCASHMENT

    OF RS.650000/.BANK DEDUCT TAX.KINDLY INFORM ME HOW MUCH AMOUNT FROM ABOVE IS TAXABLE

  41. Suma says:

    hi..
    I have joined state govt (autonomous) hospital from 15th June. Previously I was working in central govt (autonomous) hospital till 14th June . I have 90 days EL in my previous job. Can this be transferred from central to state govt hospital? when I enquired in HR section, they denied to transfer the EL. I wanted to know the Govt rules which I can show and ask for the transfer.

    Suma

  42. DK mittal says:

    Dear Sir,

    We Open a New Pvt Ltd Company on 1 April 2014, is it applicable to Earned Leave to employees. If Yes then how much earned leave. please help me

  43. POONAM PRASAD says:

    I am working in a govt. firm as contractual employee.I was on leave from 26th feb,2015 to 1st may,2015 as I was suffering from tuberculosis.2nd & 3rd, may were non-working day and 4th was Gazetted holiday.I rejoined my duty on 5th may,2015.by my leave duration in the month of may was calculated till 4th,may 2015 and salary was credited from 5th may to 31st may.

  44. Pramod Bhandari says:

    Hi,

    In my company a employee is dead on feb-2015 off duty, further our director’s want to pay his family of rs.3.20 lac as an humanity & also advance salary .

    In this certain condition is TDS is applicable on his salary ? kindly guide on this.

    Thanks & Regards
    Pramod Bhandari.

  45. S. Das says:

    I resigned from a private college and switched to a government college. From my previous employer, I have received 4.25 lac as gratuity (10.5 yrs. Service) and leave encashment of EL 121 days that comes around 2.7lac. I am asking to clarify whether these two are taxable or not?

  46. Jose V Thomas says:

    I retired from UCO BANK and I received 5 lacs towards leave encashment kindly clarify whether the total amount of 5 lacs is exempted from tax or part thereof

  47. Rahul Puri says:

    sir / mam need ur help urgntly
    my question is
    1.The amount of leave in enchashment is rupees 5 lakhs .What shall be amount of tax and upto amout shall be exampted?????rply urgent please

  48. bhaskara rao says:

    I retired from state bank of india and I received 5 lacs towards leave encashment
    kindly clarify whether the total amount of 5 lacs is exempted from tax or part thereof

  49. Binoy says:

    will you please give me a solution for the problem relating to my leave surrender encashment. i am the person relieved from one primary co-operative bank to another primary co-operative bank through kerala co-operative service examination board recruitement .but till now i didn’t get leave surrender from previous bank.i have EL220 days in my previous primary bank.is there any rule for the same mentioned above relating to my problem.may i get any way under any rule or govt.orders relate to co-operative bank to get my surrender of leave encashment.awaiting for your favourable responce

  50. P C Das says:

    For an employee in a PSB if his his salary is reduced by two increments for last 2 days on account of disciplinary action, how much should it affect the leave encashment on retirement. Should the last salary shall be the average salary drawn in the last month or the last day on account of reduction. Pl clarify with reference of guidelines.

  51. Mrinal says:

    Sir,
    I have served 10 years in state govt. then came on lean to central govt.autonomous establishment and subsequently absorb , now it become around 15 years , I have got transferred GPF amount to my new establishment , i have EL 219 days in my previous establishment, Now can i transfer the said live in present establishment or case the amount either me or present establishment or something other, Pl. advise me in detail.

    Mrinal
    mrinalck@gmail.com

  52. SHANAVAS says:

    will you please give me a solution for the problem relating to my leave surrender encashment. i am the person relieved from primary co operative bank to district co-op bank through kerala psc recruitment(category recruitment from primary bank employees).but till now i didnt get leave surrender from primary bank. is there any rule for the same mentioned above, relating to my problem.may i get it any way, under any rule relate to co-op bank to get my surrender of leave encashment. awaiting for your favorable responce.

  53. Pankaj says:

    I retd from a nationalized bank on 31-5-2014.
    I recd Rs 630000 as leave encashment.
    Whether entire amt is tax free or only Rs 300000 is tax free.
    Does a govt. bank employee comes under central govt employee.
    please explain ASAP

  54. Binil says:

    Hi,
    I am working in a Non-Gov organization (Medical college) in Karnataka Bangalore and decided to resign from this organization. I have 55 Unused ELs and when I checked with HR they are saying that Management decided for no encashment of ELs. Is it Mandatory to provide encashing of ELs at the time of releaving from the duty.
    1. Can Management can decide on this?
    2. Is Leave encashment is Mandatory?
    3 Is any written rule to show management regarding this.
    Thanks in advance

  55. sanjay verma says:

    the calculation of 10 months average salary as refected in the column E 30 is not clearly explained, exemption amount would have been different if the last salary drwan is higher that the 10 months avg salary. pl see section 10 (10AA)(ii) which says “any payment of the nature referred to in sub-clause (i) received by an employee, other than an epmloyee of the central govt or state govt., in respect of so much of the period of earned leave at his credit at the time of his retirement whether on superannuation or otherwise as does not exceed ten months calculated on the basis of the average salary drawn by the epmloyee during the period of ten months immediatly preceding his retirement whether on superannuation or otherwise subject to such limit as the central govt. may, by notification in the official gazette, specify in this behalf having regard to the limit applicable in this behalf to the employeees of that govt.

  56. Mahesh says:

    I retd from a nationalized bank on 31-5-2014.
    I recd Rs 630000 as leave encashment.
    Whether entire amt is tax free or only Rs 300000 is tax free.
    Does a govt. bank employee comes under central govt employee.
    regards

  57. s.r. sathe says:

    It imay be clarified whether the encashment of HPL at the time of retirement (within limit of 300 days for EL & HPLtaken together) is taxable or exempt from tax as Section 10(10AA) of IT act inter alia provides as follows
    any payment received by an employee of the Central Government or a State Government as the cash equivalent of the leave salary in respect of the period of earned leave at his credit at the time of his retirement [whether] on superannuation or otherwise ;
    In view of this kindly specify provision under which ‘cash equivalent of the leave salary in respect of the period of Half pay leave at his credit ( within limit of 300 days for EL & HPLtaken together) at the time of his retirement [whether] on superannuation or otherwise; is exempt from tax.;

  58. Manish says:

    I belong to Non-govt category.
    I have resigned from my company and have joined a new company.
    My previous organization has provided 17384/- as leave encashment, however, they haven’t provided any tax exemption on it.
    Can i claim that exemption in my new company, where i am declaring my previous income?
    Can i declare this amount for exemption under u/s 10 in my new company?
    please reply soon!

  59. V.Vasant Rao says:

    I retired from bank of maharashtra on 28.02.2014 and got leave encashment of Rs. 5041000/-after 1.4.2014. Now I have to file I tax returns for the year 22014-15. Kindly inform me how much amount from above is taxable?

  60. sheoji singh says:

    I RETIRED STATE BANK OF INDIA 31.07.2014.LEAVENCASHMENT AOUNT I TAX APPLIED BY AOUNT OVER 3 LAKHS.@10%.PLEASE ACKNOWLEDGE ME WHAT WILL BE DONE IN I TAX RETD SUBMISSION.

  61. P Nayak says:

    Question:

    A University of Delhi (Central University) Professor retires on 28/2/2015. He has 300 days of accumulated earned leave which can be encashed. Is the leave encashment taxable?

    (Apparently there is a UGC circular which says that leave encashment is not subject to income tax for Central University employees who are retiring.)

    Grateful if you could kindly clarify.

  62. ravikumara.n.m says:

    sir,

    I have one doubt. Encashment leave salary seperate shows in basic,da,hra in record. but at the time of hra exemption calculation already taken 12months hra. if encashment leave salary hra amount to be taken or not in calculation of hra exemption. please guide me.

  63. anslem says:

    Whether Govt employee includes only state /Central govt employees or state owned PSUs ,Public sector Ins Cos?

  64. Ujjal saha says:

    Dear sir,
    How to calculate privilege leave encashment . How long time taken to credit the amount in my
    Bank account.

  65. Ravi says:

    I am doing service in Maharashtra state road transport corp.it is semi goverment so can i avail fully exemption on leave after retirement? plz tell me

  66. omprakash chouhan says:

    mera retirement 30.4.2015 ko he kya mujhe 315 P.L ka encashment ho saketa he

  67. m.ganesan says:

    Whether Government employee means only State/Central govt. (or) state owned PSUs

  68. Reddappa Reddy says:

    My salary includesBASIC+VDA+FDA+EDUCATIONallow+HRA. which component is taken for calculation of privilege leave encashment

  69. Reddappa Reddy says:

    my salary includes basic+Vda+Fda+HRA+Personal pay+Education allowance please let me know what are the components will be taken into account of calculation of privelage leave encashment pl post the answer to my mail id

  70. Avinash says:

    Is there any condition of minimum service . like 1 year or soon. I have changed by company with in 6 months and my employer is not giving me LEAVE encashment exemption, stating that I have leave within one year.

    Request you to please advice me that whether there is any rule for the min service period.

    Thanks,
    Avinash

  71. D.L Gurumurthy says:

    Whether Govt employee includes only state /Central govt employees or state owned PSUs ,Public sector Ins Cos?

  72. shanker singh says:

    Whether Govt employee includes only state /Central govt employees or state owned PSUs ,Public sector Ins Cos? kindly reply

  73. shanker singh says:

    who comes under category of government employee to avail exemption of tax.whether state/central/psu

  74. P.K.P says:

    I AM A EMPLOYEE OF PVT . CO.I HAVE REGINED & RECEIVED RS.149500 AS LEAVE ENCASHMENT & 50000/- SALARY ,PL TEL ME LEAVE ENCASHMENT RS. 149500 IS TAXABLE?
    PL INFORM ME

  75. Jagtap J. L. says:

    Sir,
    I retired Govt. Servent Dt.- 31/08/2014 I got Rs.- 5,25,800/- encashment of leave
    Please Specify whether total amount is taxable or how much amount is taxable ?

  76. Dr Sunil says:

    I worked on 3 year tenure jon in Central Govt. After completion of my 3 Yeat tenure i got leave encashment for 45 days around 1 Lakh. Is it taxable or. exmpted fully or partialy. Kkindly explain

  77. Ganesh Gupta says:

    i m a bank employee & i have a voluntary retirement . i got rs. 495000/- recd . on account of leave incashment , i m eligible for deduction rs. 300000/-
    please confirm
    thanks
    Ganesh Gupta

  78. Bharat Gandhi says:

    Whether Govt employee includes only state /Central govt employees or state owned PSUs ,Public sector Ins Cos?

  79. SMITH says:

    Please clarify the word GOVERNMENT as well as Non GOVERNMENT.

  80. R K JAIN says:

    Dear Sir,

    My question is whether Govt. servants include employees of PSU where Govt. Of India is a sole owner and having no public shareholding???>?

    Pl. reply.

  81. Sandeep says:

    Hi,

    I am working with private Ltd. Company.

    Please to give me the suggestion for following points:
    1) Which type of leave can be taken at the time of resigned for full and final settlement ?
    2) Is there any upper limit of No. of leave for calculation of full and final settlement ?

  82. T. Sriram says:

    As per the terminology given

    ” Salary means last drawn salary and includes basic salary + Dearness Allowance (if terms of employment so provide) + Commission based on a fixed % of turnover”

    It means if the assessee receives payment of leave encashment calculated on full salary which may include any allowance, then entire amount is exempted (subject to other three conditions) since “the terms of employment so provide”.

  83. Chandrakant V Haryan says:

    Thanks for the clarification wrt Avarage Salary components.
    However, most of the companies in Private Sector do not have Dearness Allowance components. Instead other various allowance with different names. Such employees are deprived off from the benefit of D.A component while computing Leave Encashment or Gratuity.

    Does it have some remedy ?

    Chandrakant

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