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LEAVE SALARY
Employees are entitled to leaves of various types in their
service.
Either these are availed by them
For what is not availed gets
1.either lapsed or these are
2.allowed to be encashed every year or are
3.accumulated and encashed after retirement or death.
EXAMPLE: entitled leave 60 days, employee avails 20 so he has 40
days of leave as an option to get encashed or to accumulate it
and get encashed at retirement.
PRACTICAL EXAMPLE
Illustration:
Mr X an employee Siemens Ltd receives Rs.80000/- as
leave salary at the time of his retirement on 28th
Feb,2011.Average salary drawn during last 10 months
Rs.3000/-. His last drawn salary was Rs.3200/-Duration
of his service was 24 years and 7 months. Leave taken
while in service is 9 months. Leave entitlement as per
employers rules is one and half month for every
completed year. Calculate taxable leave for A.Y.2010-12.
SOLUTION