Enter salary, leave balance and service years — get your exact payout and income tax exemption, rule by rule.
All fields in Indian Rupees (₹)
Central and State Government employees get full tax exemption on leave encashment at retirement, with no upper limit.
The cash value of your leave encashment payout — calculated as leave balance days multiplied by your daily salary.
Private sector exemption is capped at ₹25,00,000 across your entire career, and separately at 10 months of average salary.
Only leave earned at the rate of up to 30 days per completed year of service counts toward the exempted leave value.
Yes. Leave encashment received by Central and State Government employees at retirement is fully exempt from income tax, with no upper ceiling.
For private sector employees, the exemption under Section 10(10AA) is the minimum of four values: actual leave encashment received, the statutory ceiling of ₹25 lakh, 10 months' average salary, and the cash equivalent of earned leave capped at 30 days per completed year of service.
For private and public sector employees, the statutory ceiling on tax-free leave encashment is ₹25,00,000 across the employee's entire career, as per the latest CBDT notification. Government employees have no such ceiling.
Yes. Leave encashment received while still in service, rather than at retirement or resignation, is fully taxable as salary income for both government and private employees.
No. Leave encashment taxation has edge cases — VRS, deemed retirement, judicial pronouncements on resignation vs retirement — that this tool simplifies for clarity. For large amounts or unusual situations, please confirm the exact treatment with your employer's payroll team or a tax professional before filing.