Tax on gratuity and leave encashment

Sir, I have worked in a Govt of india U/Taking enterprise for around 15 years.I resigned and joined in a Public sector unit and presently working.I have received an amount more than INR 5 lakh of gratuity and more than INR 2 Lakhs as leave encashment. Please clarify whether The gratuity and leave encashment is taxable or not? If These are taxable,what is the procedure to pay IT? Are there any limits for exempting?

asked Nov 08 '12 at 17:06 by bvgrov 11

Gratuity should not be taxable upto Rs 10 lakh. Regarding leave encashment, it should be non-taxable fully for a Govt employee.

answered Nov 12 '12 at 00:06 by Pankaj Batra 5.2k320


Ki Pankaj,

I think this 10lakh limit is for people working in private sectors. Govt. sector employees has no upper limit as such and is fully exempt.

Please advice.

answered Dec 24 '12 at 12:09 by Gurukul 1872916

It may not be applicable for Govt of India undertaking enterprise companies.
(Dec 24 '12 at 13:33) Pankaj Batra

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Asked: Nov 08 '12 at 17:06

Seen: 1,720 times

Last updated: Dec 24 '12 at 13:33