Career & HR
Salary, tax & workplace calculators
Full and Final Settlement Calculator
Everything owed on your last day, added up — salary, leave, gratuity, less recoveries. Accurate, instant and free — for India.
What these mean:
Salary details
Final month proration
What these mean:
Service tenure
Leave encashment
Notice period
Statutory deductions
Adjustments
Formulas reused from dedicated calculators
Net Full & Final settlement of ₹1,48,723: ₹2,58,923 payable less ₹1,10,200 deductions.
Payable components
Deductions
Gratuity is exempt under Sec 10(10) for covered employees (up to Rs 20,00,000). Notice recovery applies only when notice served is less than notice required. TDS is estimated at zero; consult your employer for the actual TDS on leave encashment and gratuity taxable portions.
How the settlement is built up
A full & final settlement is a simple sum of payables minus deductions. Every line item is derived from either a statutory formula (Payment of Gratuity Act, Code on Wages, Payment of Bonus Act) or the employment contract (notice period, outstanding loans). The calculator makes each formula explicit so you can verify the employer’s numbers line by line.
Settlement composition
Net = payables minus deductions
Payables: statutory + contractual amounts owed to the employee. Deductions: statutory obligations + contractual dues owed to the employer.
Leave encashment
Basic ÷ 26 × unused days
Casual and sick leave generally lapse on exit. Only earned/privilege leave is encashable. Some employers use (Basic + DA) ÷ 30 per company policy; 26 is the statutory default.
For private employees, leave encashment on leaving a job is exempt under §10(10AA) up to the least of ₹25,00,000, the actual amount, 10 months’ average salary, and the cash equivalent (max 30 days/year). The section says “retirement or otherwise”, which the dominant reading treats as covering resignation too — only leave encashed while still in service is fully taxable.
Pro-rata salary
Gross ÷ divisor × days worked
Divisor is 26 (working days) by default; use 30 if your employment contract specifies calendar days. “Days worked” = 1st of the final month to last working day, inclusive.
Fully taxable as salary. No exemption applies. Under the Code on Wages 2019 (effective 21 Nov 2025), the employer must settle wages within 2 working days of the last working day.
Gratuity and notice formulas
A complete FnF calculation, step by step
Gross monthly salary ₹90,000; basic ₹36,000; DA ₹0. Joined 1 Jun 2018; last working day 18 Mar 2026 → tenure 7 yrs 9 mths 17 days → rounds to 8 years(9 months > 6). Notice required 60 days; served 30 days → 30 days short. Earned-leave balance 22 days. Outstanding loan ₹20,000. State: Karnataka (PT ₹200/mo).
- 1Pro-rata salary (18 days in March 2026): ₹90,000 ÷ 26 × 18 = ₹3,461.54 × 18 = ₹62,307.69. Fully taxable as salary.
- 2Leave encashment (22 days): ₹36,000 ÷ 26 × 22 = ₹1,384.62 × 22 = ₹30,461.54. Fully taxable (resignation — §10(10AA) exemption does not apply).
- 3Gratuity (8 completed years): ₹36,000 × 15 × 8 ÷ 26 = ₹43,20,000 ÷ 26 = ₹1,66,153.85. Well below the ₹20L cap → fully exempt under §10(10).
- 4Gross payable: ₹62,307.69 + ₹30,461.54 + ₹1,66,153.85 = ₹2,58,923.08.
- 5Less deductions: Notice recovery ₹90,000 (₹90,000 ÷ 30 × 30) + loan ₹20,000 + PT ₹200 (March 2026 only) = total deductions ₹1,10,200.00. Estimated TDS ₹0 (gratuity exempt; remaining taxable components fall within §87A rebate threshold in isolation).
- 6Net FnF payable: ₹2,58,923.08 − ₹1,10,200.00 = ₹1,48,723.08. Wages due by 20 Mar 2026 (last working day + 2 working days); gratuity due by 17 Apr 2026 (within 30 days).
TDS is an estimate
Frequently asked questions
A full and final settlement combines all amounts the employer owes the employee (unpaid pro-rata salary for days worked in the final month, leave encashment for unused earned leave, gratuity if eligible, and any pro-rata statutory bonus) minus amounts the employee owes back (notice-period recovery for days not served, outstanding salary advances or loans, professional tax pro-rata for the final financial year, and TDS on taxable components). The net result is the single cheque or bank transfer the employer must release.
For non-government employees, leave encashment received on leaving a job is exempt under Section 10(10AA) up to the least of: ₹25,00,000 (lifetime cap, effective 1 April 2023 per CBDT Notification No. 31/2023), the actual amount, 10 months’ average salary, and the cash equivalent at the average daily rate (max 30 days per completed year). The section reads "retirement whether on superannuation or otherwise", and the dominant interpretation (ClearTax, TaxGuru) treats resignation as covered by "or otherwise" — so the exemption applies on resignation too, not only at retirement. Only leave encashed while still in service is fully taxable. A common error on competitor pages is citing the old ₹3 lakh limit, which applied only up to FY 2022-23. The ₹25 lakh limit is cumulative across all employers; some employers withhold conservatively, so confirm with a CA.
Gratuity uses the Payment of Gratuity Act 1972 formula: (Basic + DA) × 15 × completed years ÷ 26. For private employees it is tax-exempt under Section 10(10) up to ₹20,00,000. The employer must pay within 30 days of the last working day; delay attracts interest. Fixed-term employees qualify after 1 year of service under the Code on Social Security 2020 (effective 21 Nov 2025). Use the Gratuity Calculator to verify your gratuity amount independently before signing the no-dues certificate.
Notice-period recovery = (Gross Monthly Salary ÷ 30) × days short of the required notice. The divisor is 30 because notice periods are expressed in calendar days. Use gross salary as the base unless your appointment letter specifies basic or CTC. No GST applies to notice-pay recovery (CBIC Circular No. 178/10/2022-GST, 3 Aug 2022). Use the Notice Period Calculator to work out exactly how many days you need to serve (or buy out) before your last working day.
Under the Code on Wages 2019 (effective 21 Nov 2025), wages — which include pro-rata salary and leave encashment — must be settled by the last working day plus 2 working days. Gratuity has its own timeline: the Payment of Gratuity Act, Section 7(3), requires payment within 30 days of the date it becomes payable. Interest is payable on gratuity delayed beyond 30 days. These are statutory minimums; many companies now process the full FnF within the same 2-day window.
Yes, professional tax is deducted pro-rata for months in the final financial year that have not yet had PT withheld. If PT was already deducted in all prior months (April through the penultimate month), only the final month's PT remains. Professional tax is state-levied, capped at ₹2,500 per year by the Constitution (Article 276(2)), and not applicable in Delhi, Haryana, Uttar Pradesh, Rajasthan, Himachal Pradesh, Uttarakhand, and several other states and UTs.
Method, assumptions & references
Methodology: pro-rata salary = gross ÷ divisor (26 or 30) × days worked. Leave encashment = basic ÷ 26 × unused earned-leave days (fully taxable on resignation for private employees; §10(10AA) exemption up to ₹25L applies only at retirement). Gratuity = (basic + DA) × 15 × completed years ÷ 26; exempt up to ₹20L under §10(10) (private); payment deadline 30 days from last working day. Notice-period recovery = gross ÷ 30 × days short; no GST (CBIC Circular 178/10/2022). Professional tax deducted pro-rata for final-FY months not yet collected; state-specific, capped at ₹2,500/yr (Constitution Art. 276(2)). TDS estimated under new regime (FY 2025-26) with ₹75,000 standard deduction and §87A rebate; actual TDS depends on full-year income aggregation by the employer. EPF employee balance is processed separately via EPFO (Form 19/10C) and is not a direct FnF line-item.
TDS is an estimate; use the take-home tools for full-year tax
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