Can we Pay Leave Encashment

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Karthick (Querist)
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26 November 2016 Hi Sir, Can we pay leave encashment every year to all employees to clear liability..rather than paying while they leave so that we can same some tax please clarify me..

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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27 November 2016 Allow only 30 days leave encahment so that they will be availing some leave and you will be benefited for the full amount.
When compared to the interest you save you will not be saving much on tax, so leave encashment at the time of retirement is beneficial to the company.

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