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Gratuity Calculator
Calculate your gratuity amount based on your salary and service period
₹
₹
Years
Gratuity Amount
₹86,538
Monthly Factor: ₹17,308
Last Drawn Salary
₹30,000
Service Period
5 Years
Salary Breakup
Basic: 100.0% DA: 0.0%
Understanding Gratuity
Gratuity is a monetary benefit given by an employer to an employee for rendering continuous service for 5 years or more. It's a mandatory benefit under the Payment of Gratuity Act, 1972.
Eligibility Criteria:
- Minimum 5 years of continuous service
- Applicable on retirement, resignation, or termination
- No minimum service required in case of death or disability
- Available to all employees covered under the Act
- Tax-free up to ₹20 lakhs
Calculation Formula:
- Basic Formula: Last drawn salary × 15/26 × Years of service
- Salary includes Basic Pay and Dearness Allowance
- 15 days calculated based on 26 working days
- Service period rounded to nearest year
- Maximum gratuity limit: ₹20 lakhs
Example Calculation:
For an employee with:
- Basic Salary: ₹50,000/month
- DA: ₹10,000/month
- Service Period: 20 years
- Gratuity Amount: ₹6,92,308
Important Note:
Gratuity is tax-free up to ₹20 lakhs under Section 10(10) of the Income Tax Act. Any amount exceeding this limit is taxable as per your income tax slab.