Gratuity Calculator
Calculate your gratuity amount as per the Payment of Gratuity Act
Include your last drawn basic and dearness allowance only.
Estimated Gratuity Amount
โน1,44,231
Calculation Formula:
(15 * โน50,000 * 5) / 26 = โน1,44,231Tax Exemption:
Up to โน20,00,000 is tax-free for private sector employees under current laws.
๐ Gratuity Guide โ Reward for Your Loyalty
"Gratuity is a defined benefit plan where the employer pays a lump sum to the employee upon leaving the job after a long tenure. It is governed by the Payment of Gratuity Act, 1972."
โ๏ธ Eligibility Rules
To receive gratuity, you must have completed 5 years of service. However, if an employee becomes disabled or dies, the 5-year rule is waived. Even 4 years and 7 months are sometimes counted as 5 years.
๐ข The "26 Days" Rule
For gratuity calculation, a month is considered to have 26 working days. The 15 days of salary for every year of service is calculated as (Monthly Salary / 26) * 15.
๐ When is it Paid?
- โRetirementWhen you retire from your service.
- โResignationWhen you leave a company after 5+ years.
- โDeath/DisablementPaid to the employee or nominee immediately.
- โSuperannuationWhen you reach the age of superannuation.
Tax Exemptions (Latest)
The government has increased the tax-free gratuity limit to โน20 lakh for private sector employees. For government employees, the entire gratuity amount is exempt from tax.