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Exemption for Leave Encashment

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Vijay Sain

1 Points Posted on 08 April 2021

Does a bank employee is eligible for exemption for leave encashment at the time of retirement?
if not, how much limit. please clear

Replies (5)

Quick Summary

This discussion clarifies the eligibility of bank employees for exemption on leave encashment upon retirement. While central government employees receive full exemption, bank employees (both government and private) are eligible for an exemption up to Rs. 3 lakhs, as per Section 10(10AA) of the Income Tax Act.

ajeet singh

1392 Points Posted on 08 April 2021

20 lkh

CA. Sourav Sarkar

Chartered Accountant

24588 Points Posted on 09 April 2021

Leave cash encashment received by Central Govt bank employees are fully exempt.

300000 rupees upto exempt

CMA Poornima Madhava

CMA

13117 Points Posted on 09 April 2021

Originally posted by : Vijay Sain
	Does a bank employee is eligible for exemption for leave encashment at the time of retirement?if not, how much limit. please clear

Since, bank employees are not government employees, leave salary up to Rs.3 lacs is exempt, at the time of retirement/leaving job. Refer section 10(10AA) for more details.