Taxation for deferred Leave encashment payment

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This discussion addresses how to declare deferred leave encashment payments on your Income Tax Return (ITR). The consensus is that if the payment was declared in your Form 16 for the relevant financial year (FY 21-22 in this case), you can declare it in the same FY's ITR. Filing Form 10E is generally not required in such scenarios.

Shivam Gupta

Shivam Gupta (Querist)
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17 July 2022 Hi experts,

My last working day at my previous company was on 7th Mar, 2021. I received leave encashment after some months and the ex-employer has provided the FY 21-22 Form 16 having the leave encashment payment details.

1. Please tell how should I mention this payment in current ITR filing?

2. Will form 10E be required to get relief u./s. 89?

3. Which annexure should be selected in Form 10E for leave encashment on resignation?

4. How do I mention amount after exemption under 10(10AA) while filling Form 10E and ITR?

Thank you.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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17 July 2022 As the owner has declared it in form 16 of FY 2021-22, you have an option to declare the income in the same FY. No need of filing form 10E.

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Shivam Gupta

Shivam Gupta (Querist)
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17 July 2022 Thank you Sir for confirming

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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18 July 2022 Most welcome...

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