Tax on leave encashment

This query is : Open

Querist : Anonymous

Querist : Anonymous (Querist)

31 March 2012 In PSU , there ar two types of people one getting pension and others not getting pension. If at the time of VRS if person -eligible for pension gets leave encashment , whether it will be taxable ? and wht if the person from secong lot -(not eligible for pension)- gets leave encashment -is it taxable.

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
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31 March 2012 Least of the following is exempt under section 10(10AA)(ii) :
(a) Leave encashment in respect of the period of earned leave standing to the credit of employee at the time of retirement/superannuation.
[Earned leave entitlement not to exceed 30 days for every year of actual service rendered for the employer]
(b) 10 months ‘average salary’
(c) Amount specified by government [Rs. 3,00,000 (Where the retirement is on or after 1-4-1998)].
(d) Amount actually received.
Eligibilty for pension will not have any impact
CA MANOJ GUPTA
JODHPUR
09828510543

Querist : Anonymous

Querist : Anonymous (Querist)

31 March 2012 sir, thanx but wanted to know whether psu--bsnl employees come under govt employee category. the reason for i asking this is , bsnl was carved out of deprtment of telecom by shifting people. -- so those people whether they fall under govt cat?. IT IS CLEAR THAT new people recruited by bsnl will not faLl under govt employees. . PLS CLARIFY ABOUT THE OLD ONES.

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