Who pays notice period buyout?

Sometimes you, sometimes the new employer. Get it in writing — amount, tax treatment, and timing — before you resign.

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Notice period buyout: how the money math works

What notice period buyout means in Indian jobs, who pays, tax angles to check, and when accepting a buyout is worth it.

6 min read · Updated 4 July 2026

Buyout = paying for the days you do not serve. Sometimes you pay, sometimes the new employer does. Read the offer and the exit policy before you celebrate an early release.

Confirm amount: gross per day × days short.
Who pays: you vs new company joining bonus / reimbursement.
Tax: reimbursements can be taxable — check payslip treatment.
Never resign on verbal promises alone.

Common questions

Who pays notice period buyout?: Sometimes you, sometimes the new employer. Get it in writing — amount, tax treatment, and timing — before you resign.

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General education, not personalised financial advice. Rules and rates change — verify the current position before you act.