Leave Encashment Calculator
A leave encashment calculator works out the payout for unused leave days. Enter the monthly Basic + Dearness Allowance, the number of leave days to encash and the days basis to see the leave encashment amount and per-day value.
Basic salary plus dearness allowance.
Most employers use 30; some use 26 working days.
At a glance
How the leave encashment calculator works
- 1 Enter the monthly Basic salary plus Dearness Allowance (the components most policies use for encashment).
- 2 Enter how many unused leave days are being encashed.
- 3 Choose the days basis your employer uses (30 calendar days or 26 working days).
- 4 The calculator returns the per-day value and the total payout.
Per-day value = Monthly (Basic + DA) ÷ Days basis. Leave encashment = Per-day value × Leave days encashed.
Frequently asked questions
How is leave encashment calculated?
The common formula is: (Monthly Basic + DA ÷ days basis) × number of leave days encashed. The days basis is usually 30 (calendar days) or 26 (working days), depending on your employer's policy.
Is leave encashment taxable?
It depends on jurisdiction and whether it is paid during service or at retirement. In many places, encashment during employment is taxable as salary, while retirement encashment may be partly or fully exempt up to a limit. Check local rules or your payroll team.
Which salary components are used for leave encashment?
Most policies use Basic salary plus Dearness Allowance (DA). Some include other fixed allowances. Confirm which components your organisation's leave policy specifies.
Should I use 26 or 30 days as the basis?
Use whatever your employment contract or leave policy states. 30 treats every calendar day equally; 26 reflects typical working days in a month and yields a slightly higher per-day value.