Calucation of leave encashment

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sunil (Querist)
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07 September 2011 Mr. x has resign from y ltd. at time of resign Rs 89811 as leave encashment for 38 days leave. his 10 month average salary is 40531 and total period of service is 14 year. what is taxable amount of leave encashment. leave unavail is 38
plz reply with calculation

Hari Beldona

Hari Beldona (Expert)
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07 September 2011 Leave Salary Section 10(10AA)
In case of a non-government employee exemption is calculated as below:

1.Actual amount received ..Rs 89,811 or

2.Avg. Salary of last 10 months x balance leave calculated on 30 days
i.e 40531 x 10 x 38/30 = Rs 5,13,392

3. Avg Salary x 10 months
i.e 40531 x 10 = Rs 4,05,310

4. Rs 3,00,000

Whichever is lower of the above four

Ravi Jhamb

Ravi Jhamb (Expert)
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07 September 2011 Computation of Taxable Leave & Encashment
In the hand of Mr. (For P.Y

Income Received as Leave Salary 89,811 Less:- Exemption U/s 10(10AA)

Actual Amount Received 89,811

Maximum Exemption 300,000

10 Month Average Salary 405310

CashEquivalent

You did not delcare avail and unavail leave leave during the job

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