Compute your Earned Leave encashment at retirement or resignation. Includes Rs.25 lakh tax exemption under Section 10(10AA).
Enter your EL balance and pay details to compute your leave encashment.
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Along with leave encashment, build a retirement corpus with mutual funds and NPS top-up.
EL encashment = EL days × (Basic+DA) / 30. Capped at 300 days under CCS Leave Rules. Monthly rate divided by 30, not 26.
Section 10(10AA) exempts up to Rs.25 lakh of leave encashment at retirement/superannuation for Central Govt employees — entirely tax free.
Retirement, resignation, death-in-service and disability cases are handled with appropriate rules for each.
Central Government employees accumulate Earned Leave (EL) at the rate of 2.5 days per month (30 days per year). The maximum EL that can be accumulated is 300 days. At the time of separation from service, the entire EL balance (maximum 300 days) can be encashed.
Cash Equivalent = EL Balance (days) × (Last Basic Pay + DA) / 30
Note: The divisor is 30 (calendar days in a month), not 26 working days. This is specifically prescribed under CCS Leave Rules.
Maximum 300 days of EL can be encashed at the time of retirement. However, a Central Government employee can also encash EL during service (up to 10 days at a time while proceeding on LTC) — but such in-service encashment reduces the balance available at retirement.
For Central Government employees retiring on superannuation or VRS, leave encashment is fully exempt from Income Tax under Section 10(10AA)(i) — there is no monetary ceiling. For non-government employees, the exemption is limited to Rs.25 lakh (enhanced in 2023 Budget from Rs.3 lakh).
For Central Government employees retiring on superannuation, leave encashment is fully tax-exempt under Section 10(10AA)(i) — no ceiling applies. For state government employees, the same exemption applies. For private sector employees, exemption is limited to Rs.25 lakh.
No. Only Earned Leave (EL) can be encashed. Half Pay Leave cannot be encashed at retirement. However, HPL can be commuted to EL for the purpose of leave count in some specific administrative cases.
On resignation, EL encashment is permitted provided you have completed 20 years of qualifying service. The encashment is the same formula as retirement — EL balance × (Basic+DA)/30 — but the amount may be taxable depending on the income tax rules applicable at the time.