How this calculator works
We add your savings to your final settlement after tax. Month 1 is the first month without salary. Each month your spending is paid from that money, less any other income, and your health-insurance premium is paid in month 1 and every 12 months. The runway is how many months the money covers. We work it out twice: at your spending today, and with “everything else” cut back to the amount you choose. Savings are assumed to earn nothing, which keeps the answer on the safe side.
Tax on your final settlement
Severance, notice pay and leave encashment are added to the salary you were paid this financial year and taxed under the new regime, with the ₹75,000 standard deduction. That is why a large payout late in the year is taxed at a higher rate than one early in the year. Gratuity is tax-free up to ₹20 lakh. Part of a retrenchment payment and of leave encashment can also be tax-free under specific rules; we do not count that, so your real tax may be lower. Your employer deducts tax (TDS) from the payout, and any difference is settled when you file your return.
Your PF after a job loss
Under the EPF rules, you can withdraw 75% of your PF after one month without work, and the rest after 12 months of continuous unemployment. These rules changed in 2026, so confirm the current ones on the EPFO portal before you apply. Your PF earns more than most savings accounts and moves to your next employer, which is why this calculator leaves it out unless you switch it on.
How long a runway do you need?
Long enough for your job search, plus a buffer. Searches take longer for senior roles, in slow hiring markets and around year-end holidays. If your runway is shorter than your search, the biggest levers are usually the spending you can pause, other income in the household, and talking to your lender before EMIs become a problem.
Frequently asked questions
Is severance pay taxable in India?
Yes. Severance and notice pay are generally taxed as salary, at your slab rate for the year. Compensation paid on retrenchment can be partly tax-free under specific conditions, so ask your employer how it is classified and confirm with a tax professional.
Should I withdraw my PF after a layoff?
Only if your other savings run short. PF earns a good, steady rate and is meant for retirement. If you need it, you can take 75% after a month without work and the rest after 12 months. Switch on “Use my PF as a last resort” to see how much time it would add.
How much emergency fund should I have?
Enough to cover your essential spending for the time it would take to find a new job. For many people that is six months or more. The “if you cut back” runway shows how long your money lasts on essentials alone.
What if my severance is paid in instalments?
Enter the total. If it comes over several months it lands a little later, but the total it adds to your runway is about the same.
I work abroad on a visa. Can I use this?
This calculator is for income and tax in India. If losing your job abroad means moving back, the Return to India calculator shows whether your money covers the move and life in India.