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Full and final settlement calculator (F&F)

Full and final settlement is the salary for days worked in the last month, plus leave encashment, gratuity if the employee qualifies and any other dues, minus loans, advances and other allowed deductions. Under the Code on Wages, wages due are paid within two working days; gratuity within 30 days.

Last month's salary

Leave encashment

Gratuity

Deductions

Salary for the last month—
Leave encashment—
Gratuity (—)—
Other dues—
Total payable—
Less deductions—
Net settlement before tax—
Wages due by2 working days after exit
Gratuity due by30 days

An estimate before PF, ESI, Professional Tax and TDS on the final salary. Gratuity wages follow the Code's definition, which can be higher than basic pay. Whether notice pay can be deducted is disputed: see the F&F guide before you recover it.

Doing this every month for your whole team?

AiroHR works this out for every employee from their attendance, then gives you payslips, bank files and the PF ECR file. See it on your own payroll, or get the month's dates by email.

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Updated 12 November 2026 · Checked against our full and final settlement guide · By the AiroHR team

Key facts (as of 12 November 2026)

  • Wages due at exit must be paid within two working days under section 17(2) of the Code on Wages, 2019, in force from 21 November 2025 (Ministry of Labour and Employment).
  • The rule covers resignation as well as removal, dismissal, retrenchment and closure.
  • Gratuity has its own 30-day period under the Code on Social Security, 2020.
  • Total deductions in a wage period cannot be more than 50% of wages (section 18, Code on Wages).

How is full and final settlement calculated?

Add the salary for the days worked in the last month, leave encashment at your policy's daily rate, gratuity if the employee has the service for it, and any bonus or claims due. Then subtract loan and advance balances and other deductions the Code allows. The result is the net settlement before tax.

F&F = last month's salary + leave encashment + gratuity + other dues − loans and allowed deductions

The calculator's starting figures are the guide's worked example: ₹45,000 a month and 15 days of a 31-day month (₹21,774), 10 days of leave on ₹22,500 ÷ 30 (₹7,500), gratuity on ₹22,500 for 6 years (₹77,885), less a loan of ₹8,000. Net settlement: ₹99,159.

How many days does an employer have to pay F&F?

Two working days for the wages due, under section 17(2) of the Code on Wages, 2019. Commentators read the two days as running from the last working day. Gratuity has its own 30-day period, and PF is claimed by the employee from EPFO.

Is gratuity part of full and final settlement?

Yes, when the employee qualifies: five years of continuous service for regular staff, one year for fixed-term staff, and no minimum on death or disablement. It is worked out as last drawn wages × 15 ÷ 26 × years of service and paid within 30 days, separately from the two-day wages.

The gratuity calculator shows both figures for fixed-term staff, and the leave encashment calculator works out the tax-free part of leave pay.

Read next

Full and final settlement: the two-day rule Gratuity calculator Leave encashment calculator Exit and F&F software
FAQ

F&F calculator questions

How is full and final settlement calculated?

Salary for the days worked in the last month, plus leave encashment, gratuity if the employee qualifies and other dues such as bonus or claims, minus loan and advance balances and other deductions the Code allows.

What is the time limit for full and final settlement in India?

Wages due must be paid within two working days under section 17(2) of the Code on Wages, 2019, which also covers resignation. Gratuity has its own 30-day period.

Is gratuity included in full and final settlement?

Yes, if the employee qualifies: five years of continuous service for regular staff and one year for fixed-term staff. The five-year condition does not apply on death or disablement.

Can an employer hold F&F until clearance is done?

Not the whole amount. Commentators agree the Code does not make wages depend on clearance. Deduct what you are allowed to and pay the balance on time.

Is TDS deducted from full and final settlement?

Yes. Tax on the amounts paid at exit still applies, and PF, ESI and Professional Tax apply to the final salary as usual.

Settle every exit on time

AiroHR works out unpaid salary, leave encashment, gratuity and the loans still owed on the exit screen, and HR can change any line before approving the settlement.

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