10 December 2024
I resigned from services of private IT company in July 2024 and not employed anymore. I was given "Leave Encashment" (under that head itself) as part of Full and Final settlement, but company has included "Leave Encashment" FULLY as taxable salary in their tax computation sheet. I am in New Tax Regime and my questions are : 1. Can I claim Leave Salary Exemption under Section 10(10AA) ? and to claim this do I have to fill in Form 10e prior to filing my ITR for AY2025-2026. 2. How to compute Leave Salary Exemption under Section 10(10AA) ? I was given Leave Encashment based on full salary of July 2024 for 45 days. As per company rules, every year we were eligible for 15 days Earned Leave which can be accumulated for "maximum encashable" 45 days and rest of EL lapses. I am not clear on how to calculate the Leave Cash Equivalent in this condition, considering I have worked for 21 years in the same organization.