Example:-Mr. X retired from ABC Ltd. on 11th March 2014 after serving for 30 years and 11 months and the employer has paid him leave salary of ₹ 5,00,000. At the retirement, he was getting basic pay of ₹ 22,000. Further he was getting dearness allowance of ₹ 4,000 and 50% of the DA forms the part of salary for retirement benefits. The employee was entitled for 3 months leave for every year of service, but the employee has availed 7 months leave throughout the service and has encashed 4 months leave. Compute leave salary exemption u/s 10(10AA) for the AY 2014-15.

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..... pay of ₹ 22,000. Further he was getting dearness allowance of ₹ 4,000 and 50% of the DA forms the part of salary for retirement benefits. The employee was entitled for 3 months leave for .....

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..... verage salary : Basic = 22,000 x 10 = 2,20,000 DA = 4,000 x 10 x .50 = 20,000 Average Salary = (2,20,000 + 20,000)/10 = 24,000 Calculation of Unavailed Leaves: Leaves calculated lea .....

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