mr.x retired from xyz on 1/8/19 and received 4lak as leave encashment he received leave encashment for 12 month he was allowed to take 45 days leave each year
total completed yrs 21 yr
average salary 28000pm
calculate perquisites
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Leave encashment under salary head
Replies (3)
Quick Summary
(a) Government employees: Leave salary received at the time of retirement is fully exempt from tax.
(b) Non-government employees: Leave salary received at the time of retirement is exempt from tax to the extent of least of the following:
(i) ` 3,00,000
(ii) Leave salary actually received
(iii) 10 months’ salary (on the basis of average salary of last 10 months)
(iv) Cash equivalent of leave (based on last 10 months’ average salary immediately preceding the date of retirement) to the credit of the employee at the time of retirement or death. Earned leave entitlement cannot exceed 30 days for every year.
Notes:
1. Leave salary received during the period of service is fully taxable.
(b) Non-government employees: Leave salary received at the time of retirement is exempt from tax to the extent of least of the following:
(i) ` 3,00,000
(ii) Leave salary actually received
(iii) 10 months’ salary (on the basis of average salary of last 10 months)
(iv) Cash equivalent of leave (based on last 10 months’ average salary immediately preceding the date of retirement) to the credit of the employee at the time of retirement or death. Earned leave entitlement cannot exceed 30 days for every year.
Notes:
1. Leave salary received during the period of service is fully taxable.
Ques ka ans?
(a) Government employees: Exempt
(b) Non-government employees : Taxable 3,58,000
(b) Non-government employees : Taxable 3,58,000
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