Calculate Relief u/s 89 with Example
Introduction & Importance
Section 89 of the Income Tax Act, 1961, allows employees to claim tax exemption on the amount of leave encashment received at the time of retirement. This calculator helps you calculate the relief u/s 89 with example…
How to Use This Calculator
- Enter your total income.
- Enter the standard deduction amount.
- Select your applicable tax rate.
- Click ‘Calculate’.
Formula & Methodology
The formula to calculate relief u/s 89 is: (Income – Standard Deduction) * Tax Rate – (Income – Standard Deduction – Relief) * Tax Rate
Real-World Examples
Data & Statistics
| Income | Tax Rate |
|---|---|
| Up to ₹2.5 lakh | 0% |
Expert Tips
- Always encash your leave before retirement to claim exemption.
- Keep records of all your income and deductions for future reference.
Interactive FAQ
What is the maximum limit for leave encashment exemption?
10 months’ salary for government employees and 6 months’ salary for non-government employees.