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Asked by Pankaj on :Jun. 14, 2018

Is leave encashment salary is taxable?

Is leave encashment salary is taxable?

Is leave encashment salary is taxable?

0

Jeeba Jun. 14, 2018

Taxation on leave encashment salary depends upon the certain conditions

If you receive while in service then it is fully taxable. If leave encashment salary is received at the time of retirement then...
a) It is exempt in the hand of government employees
b) In case of non-government employees, least of the following shall be exempted.

i. Maximum 10 months salary on the basis of average salary drawn during 10 months immediately preceeding his retirement/leaving job otherwise.

ii. Salary for approved period of leave standing to his credit at the time of retirement/leaving job otherwise.

iii. Maximum notified limit 3,00,000

iv. Actual amount received as leave encashment and balance shall be taxable

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