Is Form 10E applicable for Notice Pay received in Full & Final Settlement?

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Hi Everyone,

I need some guidance regarding Section 89 and Form 10E.

I resigned from my job and my last working day was 27-Feb-2026. My notice period was 3 months, but the company relieved me early and paid me for the remaining notice period as part of my Full & Final settlement.

The breakup was:

  • 1 month as Resign Salary Release [ Feb 2026]
  • 2 months as Notice Pay [ March and April 2026]

The entire amount was taxed, TDS was deducted, and it is included in my Form 16 for FY 2025-26.

Because of this, an amount equivalent to April[FY 2026-27] notice period was also taxed in FY 2025-26, even though my employment had already ended in February.

Can I claim relief under Section 89 by filing Form 10E for this payment?

Replies (1)

Yes, Section 89(1) provides relief for salary received in advance or as arrears to prevent excessive tax brackets.

You must file Form 10E on the official Income Tax e-filing portal.

Ensure Form 10E is filed before filing your Income Tax Return for the relevant Assessment Year.

Retain your settlement breakup and Form 16 as proof for any future verification by the Income Tax Department.

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