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Leave Encashment Calculator
Calculate leave encashment payout and the income-tax exemption under Section 10(10AA). Updated for the FY 2023-24 increase in private-sector ceiling from ₹3L to ₹25L.
Total encashment
₹3,60,000
Tax exempt₹3,60,000
Taxable₹0
Section 10(10AA) — exemption rules
- Govt employees: leave encashment at retirement is fully exempt.
- Private employees at retirement / resignation: exemption is the lowest of —
- ₹25 lakh (Budget 2023; was ₹3L before)
- 10 months' average salary
- Actual encashment
- Leave at credit × salary (with 30 days/year credit cap)
- During service: encashment is fully taxable as salary income — no exemption.
- Section 89(1) relief available to spread across earlier years if encashment pushes you into a higher slab.