Gratuity Calculator
Calculate your gratuity amount based on your last drawn salary and years of service.
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What is Gratuity?
Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation for their service. It is governed by the Payment of Gratuity Act, 1972.
Eligibility
- Employee must have completed 5 years of continuous service
- Payable on retirement, resignation, superannuation, or death
- Exception: 5-year rule waived in case of death or disability
Formula
Gratuity = (15 × Last Drawn Salary × Years of Service) / 26
- 15 days' salary for each completed year
- 26 = number of working days in a month
- Last drawn salary = Basic + Dearness Allowance
Tax Exemption
- Gratuity up to ₹20 lakh is tax-free for eligible employees
- Amount above ₹20 lakh is taxable as per income tax rules
- Applies to employees covered under the Gratuity Act
Important Note
If your service is more than 6 months in the last year, it is rounded up to the next full year. If less than 6 months, it is ignored.