Leave Encashment Calculator
Leave encashment amount on resignation or retirement and the tax-free portion up to ₹25 lakh for private employees.
How to use the Leave Encashment calculator
- Enter monthly basic + DA, earned leave balance (days), days in a month used by employer and encashed on retirement or resignation?.
- Read the leave encashment at the top of the result, with tax-free (indicative), taxable underneath. It updates as you type.
- Change one input at a time to see what moves the answer most, then save the result with Copy link or Download PDF.
About this tool
Encashment during service is fully taxable. On leaving, the exemption is the lowest of ₹25 lakh, actual amount, 10 months' average salary, and cash value of up to 30 days per year of service; this tool applies the ₹25 lakh and 10-month limits.
Worked example
With monthly basic + da of ₹60,000, earned leave balance (days) of 90, days in a month used by employer of 30 days and encashed on retirement or resignation? of Yes:
| Leave encashment | ₹1,80,000 |
| Tax-free (indicative) | ₹1,80,000 |
| Taxable | ₹0 |
Built and reviewed by Savitar Finance (savitarfinance@gmail.com). Rules and rates last checked October 2026. How we calculate · Report a problem
Questions people ask
Is leave encashment taxable?
While in service, yes. On retirement or resignation, private employees get an exemption up to ₹25 lakh over a career, subject to the other limits.
How is leave encashment calculated?
Usually basic + DA ÷ 30 (or 26) × leave days, as per your employer's policy.