Leave Encashment Calculator
Calculate the taxable portion of leave encashment received at the time of resignation or retirement.
Taxable = Least of:
- Actual leave encashment received
- Cash equivalent of unavailed leave (30 days max/year)
- 10 months × average salary (Basic + DA)
- ₹3,00,000 (statutory limit for non-government)
What is Leave Encashment Calculator?
Leave encashment is the payment you receive for unused leave days when you resign or retire. A leave encashment calculator estimates the amount you will receive and its taxability.
For government employees, leave encashment is fully tax-exempt. For private employees, the exemption is limited to the least of specified amounts, capped at ₹25 lakh.
How does the Leave Encashment Calculator work?
The exemption for private employees is the least of: actual amount received, 10 months' average salary, cash equivalent of unavailed leave (max 30 days per year of service), and ₹25 lakh.
The calculator shows the taxable portion of your leave encashment.
How to use the Leave Encashment Calculator?
- Enter your basic salary and dearness allowance.
- Enter your unused leave days.
- Enter your years of service.
- The calculator shows the encashment amount and tax-exempt portion.
Example
Try the calculator with your own numbers
- Enter your values in the input fields above.
- Adjust the values to match your situation.
- The result updates instantly as you change the inputs.
Benefits of using the Leave Encashment Calculator
- Know your leave encashment entitlement.
- Plan the tax impact of resigning or retiring.
- Understand the exemption limits.
- Negotiate your exit package better.
Who should use the Leave Encashment Calculator?
- Individuals planning loans, investments, or retirement savings.
- Salaried employees estimating taxes, EMIs, and take-home pay.
- Small business owners tracking costs, margins, and cash flow.
- Students learning personal finance and investment concepts.
Tips for getting the most out of the Leave Encashment Calculator
- Use realistic return rates — past performance does not guarantee future returns.
- Re-run the calculation whenever your income, expenses, or goals change.
- Compare a few scenarios (conservative, moderate, aggressive) before making a decision.
Frequently Asked Questions
Is leave encashment taxable?
For government employees it is fully exempt. For private employees, the exemption is limited to the least of four specified amounts, capped at ₹25 lakh.
How many leave days can be encashed?
Typically, unavailed earned leave up to 30 days per year of service can be encashed, subject to your employer's policy.
Is leave encashment during service taxable?
Yes, leave encashment received while continuing in service is fully taxable as salary.
Planning your finances is easier when you can see the numbers clearly. Use this calculator regularly to stay on top of your goals and make informed decisions.
Related Calculators
Income from House Property Calculator
Calculate taxable income from rental property including standard deduction and home loan interest.
Medical Facility Calculator
Calculate the taxable value of medical facility provided by your employer, in India or outside India.
Rent Free Accommodation Calculator
Calculate the taxable perquisite value of rent-free accommodation provided by employer.
80C Calculator
Calculate deductions under Section 80C and tax saved from EPF, PPF, ELSS, insurance and more.
80D Calculator
Calculate health insurance premium deduction under Section 80D for self and parents.
80DD & 80U Calculator
Calculate disability deduction under Section 80DD for disabled dependents and 80U for self.