KnowMyContract

Free interactive calculator

Notice Period & Salary Buyout Calculator

Estimate the exact gross buyout your employer can claim if you exit before serving full notice — plus the approximate after-tax cost to you. Slide the numbers and watch the result update in real time.

Your numbers

High risk
Real-time estimate
Gross buyout: ₹2,00,000

60 unserved days × ₹3,333 daily base pay = ₹2,00,000. That's roughly 2.0× your monthly salary.

Daily base pay (salary ÷ 30)
₹3,333
Shortfall days
60
Gross buyout
₹2,00,000
Approx. after-tax cost to you (estimate, not tax advice)
₹2,20,000 – ₹2,40,000

What to do: High exposure. Before you resign, ask HR to (a) cap buyout at basic pay for unserved days only, (b) allow leave encashment to offset the buyout, and (c) confirm in writing that CTC components are excluded.

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Frequently asked questions

Should buyout be calculated on basic or CTC?
Basic pay. CTC includes variable pay, provident fund, and benefits you never received — using it inflates the buyout unfairly. Fair contracts cap buyout at basic × unserved days ÷ 30.
Is the buyout taxable?
If your employer pays it on your behalf, it is treated as salary income and taxed in your hands. If you pay it out of pocket, it is NOT deductible from your salary income under current Indian tax law. The after-tax estimate above illustrates the real cost. This is not tax advice — confirm with a CA.
Can my employer refuse to accept my buyout?
Only if the contract makes buyout subject to employer consent. Fair contracts grant you a unilateral right to buy out unserved notice at any time.
Is a 90-day notice period legal?
Yes, but it should be symmetric. A 90-day notice from you paired with a 30-day notice from the employer is a common trap that most HR teams will renegotiate when asked.

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