Earned Leave Encashment Calculator — EL Balance & Retirement
Calculate EL encashment at retirement and project your EL accumulation. Updated with ₹25 lakh tax exemption limit for 2026.
EL Encashment at Retirement
Formula: (Basic Pay + DA) × EL Balance ÷ 30
= (₹44,900 + ₹26,940) × 300 ÷ 30
EL Encashment Amount
₹7,18,400
300 days at ₹2,395/day
Tax Status
Fully Exempt
Section 10(10AA)
Encashment at Different EL Balances
| EL Days | Encashment | Tax Status |
|---|---|---|
| 50 | ₹1,19,750 | Exempt |
| 100 | ₹2,39,500 | Exempt |
| 150 | ₹3,59,250 | Exempt |
| 200 | ₹4,79,000 | Exempt |
| 250 | ₹5,98,750 | Exempt |
| 300 | ₹7,18,500 | Exempt |
EL Accumulation Projector
Credited/Year
30 days
Used/Year
10 days
Final Balance
300 days
Projected Encashment
₹7,18,400
| Year | Credited | Used | Balance | Capped? |
|---|---|---|---|---|
| 1 | +30 | -10 | 140 | — |
| 2 | +30 | -10 | 160 | — |
| 3 | +30 | -10 | 180 | — |
| 4 | +30 | -10 | 200 | — |
| 5 | +30 | -10 | 220 | — |
| 6 | +30 | -10 | 240 | — |
| 7 | +30 | -10 | 260 | — |
| 8 | +30 | -10 | 280 | — |
| 9 | +30 | -10 | 300 | 300 cap |
| 10 | +30 | -10 | 300 | 300 cap |
EL accumulation capped at 300 days. Balance above 300 lapses on Jan 1 and Jul 1. Complete leave rules →
How EL Encashment Works
At retirement, a Central Government employee can encash their entire Earned Leave (EL) balance up to 300 days. The encashment is calculated as: (Basic Pay + DA) × EL Balance ÷ 30. This uses the last drawn basic pay and the DA rate applicable on the date of retirement.
EL encashment is one of the three major retirement benefits alongside gratuity and pension/NPS. For a Level 7 employee (Basic ₹44,900) with DA at 60% and full 300 days balance, the encashment would be approximately ₹7,18,400. Tax exemption is up to ₹25 lakh under Section 10(10AA).
EL Accumulation Rules
EL is credited at 15 days on January 1 and 15 days on July 1 (30 days per year). The maximum accumulation is 300 days — any balance exceeding this lapses automatically when new EL is credited. The minimum spell for EL is 5 days. EL can be combined with other types of leave (HPL, CCL). See our complete leave rules guide for details on all leave types.
EL Encashment During LTC
In addition to retirement encashment, employees can encash up to 10 days of EL per LTC block (4-year period). This is separate from the retirement benefit. However, LTC encashment is fully taxable in the year of receipt — unlike retirement encashment which has the ₹25 lakh exemption. See our LTC Guide for block years and rules.
Tax Rules for EL Encashment
At Retirement
Exempt up to ₹25,00,000 under Section 10(10AA). Limit increased from ₹3 lakh in Budget 2023. Amount above ₹25 lakh is taxable as salary.
During Service (LTC)
Fully taxable in the year of receipt. No exemption applies. Max 10 days per LTC block. Use our tax calculator.
Tips to Maximize EL Encashment
- Maintain close to 300 days balance: Plan leave usage so your balance stays near the 300-day cap approaching retirement.
- Watch the credit dates: EL above 300 lapses on Jan 1 and Jul 1. If your balance is 295 in December, use only 0-5 days in Jan-June to maximize.
- LTC vs retirement encashment: LTC encashment (10 days) is taxable while retirement encashment is mostly exempt. Consider saving EL for retirement if you don't need LTC encashment.
- Use HPL/CL first: When possible, use Casual Leave and Half Pay Leave before touching your EL balance. This preserves EL for retirement encashment.
- Check your pay matrix level: Higher basic pay = higher encashment value. Use the pay matrix to verify your current pay.
EL Encashment — Frequently Asked Questions
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