Income Tax Act

Alert – 25-5-2023
Attn.: Employers
Increased Limit for Tax
Exemption
Earned Leave (25 Lakhs)

Find below the PRESS RELEASE /

Gazette
रजजस्ट्री सं. डी.एल.- 33004/99 REGD. No. D. L.-33004/99

सी.जी.-डी.एल.-अ.-24052023-246047
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CG-DL-E-24052023-246047
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असाधारण
EXTRAORDINARY
भाग II—खण्ड 3—उप-खण्ड (ii)
PART II—Section 3—Sub-section (ii)
प्राजधकार से प्रकाजित
PUBLISHED BY AUTHORITY

सं. 2182] नई ददल्ली, बुधिार, मई 24, 2023/ज्येष्ठ 3, 1945

No. 2182] NEW DELHI, WEDNESDAY, MAY 24, 2023/JYAISHTHA 3, 1945

जित्त मंत्रालय
(राजस्ट्ि-जिभाग)
(के न्द्रीय प्रत्यक्ष कर बोडड)
अजधसूचना
नई ददल्ली, 24 मई, 2023
(आयकर)
का.आ. 2276(अ).—आयकर अजधजनयम, 1961 (1961 का 43) की धारा 10 के खंड (10 कक) के उप-खंड (ii)
द्वारा प्रदत्त िजियों का प्रयोग करते हुए, कें रीय सरकार एतद्द्वारा अपने कमडचाररयों को उनकी सेिाजनिृजत के समय चाहे
अजधिार्षिता अथिा अन्द्यथा कारणों से है, उनके खाते में अर्षजत अिकाि की अिजध के संबंध में छु ट्टी िेतन के बराबर नकद
राजि के रूप में कमडचाररयों द्वारा प्राप्य अजधकतम राजि पर ध्यान देते हुए ₹ 25,00,000/- (पच्चीस लाख रूपए मात्र) की
राजि को उक्त खंड में उजल्लजखत कमडचाररयों, जजनकी सेिाजनिृजत्त, अजधिार्षिता अथिा अन्द्यथा कारणों से है, के संबंध में
सीमा के रूप में जिजनर्ददष्ट करती है
2. यह अजधसूचना 1 अप्रैल, 2023 से प्रभािी मानी जाएगी
[अजधसूचना सं. 31/2023 फा. सं. 200/3/2023-आईटीए-I]
सौरभ जैन, अिर सजचि
व्याख्यात्मक ज्ञापन : यह प्रमाजणत दकया जाता है दक इस अजधसूचना को भूतलक्षी प्रभाि देने से दकसी भी व्यजि पर
प्रजतकू ल प्रभाि नह प़ रहा है
3299 GI/2023 (1)
2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(ii)]

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 24th May, 2023
(INCOME-TAX)
S.O. 2276(E).—In exercise of the powers conferred by sub-clause (ii) of clause (10AA) of
section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government, having regard to the
maximum amount receivable by its employees as cash equivalent of leave salary in respect of the period of
earned leave at their credit at the time of their retirement, whether superannuation or otherwise, hereby
specifies the amount of Rs. 25,00,000 (twenty-five lakhs rupees only) as the limit in relation to employees
mentioned in that sub-clause who retire, whether on superannuation or otherwise.
2. This notification shall be deemed to have come into force with effect from the 1st day of
April, 2023.
[Notification No. 31/2023/F. No. 200/3/2023-ITA-I]
SOURABH JAIN, Under Secy.

Explanatory Memorandum : It is hereby certified that no person is being adversely affected by giving
retrospective effect to this notification.

Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.
 Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
******

New Delhi, 25th May, 2023

PRESS RELEASE

Increased limit for tax exemption on leave encashment for non-government

salaried employees notified

The tax exemption on leave encashment of non-government salaried employees

(in respect of the period of earned leave at his credit at the time of his retirement,
whether on superannuation or otherwise) was earlier upto a limit of Rs.3 lakh only under
section 10(10AA)(ii) of the Income-tax Act,1961(the Act).

In pursuance to the proposal in the Budget Speech, 2023, by the hon’ble FM,
the Central Government has notified the increased limit for tax exemption on leave
encashment on retirement or otherwise of non-government salaried employees to Rs.
25 lakh w.e.f. 01.04.2023.
The aggregate amount exempt from income-tax under section 10(10AA)(ii) of the
Act shall not exceed the limit of Rs. 25 lakh where any such payments are received by
a non-government employee from more than one employer in the same previous year.
Further, the amount exempt from income-tax under section 10(10AA)(ii) of the
Act shall not exceed the limit of Rs. 25 lakh as reduced by the tax exemption already
allowed in the total income of the employee under section 10(10AA)(ii) of any previous
year or years.
Notification No.31/2023 dated 24.05.2023 has been published and is available at
https://egazette.nic.in.

(Surabhi Ahluwalia)
Pr. Commissioner of Income Tax
(Media & Technical Policy) &
Official Spokesperson, CBDT