Gratuity Calculator
Payable gratuity under the Payment of Gratuity Act, 1972.
Compute gratuity payable under the Payment of Gratuity Act, 1972 (subsumed by Code on Social Security, 2020 effective 21 November 2025). Gratuity is mandatory for employees who complete 5 years of continuous service (some exceptions).
Gratuity Computation
Years considered0
Days per year (formula)15
Calculation-
Computed gratuity₹ 0
Statutory ceiling₹ 20,00,000
Gratuity Payable₹ 0
Statutory ceiling: Rs 20 lakh (under Payment of Gratuity Act / SS Code). Tax exempt up to this limit under Sec 10(10) of Income Tax Act for government employees; pro-rata for private sector.
Gratuity rules:
- Eligibility: 5 years of continuous service (waived for death / disablement / fixed-term contracts from Nov 2025).
- Coverage: Establishments employing 10+ persons (factories, mines, oil fields, plantations, ports, railways, shops, establishments).
- Formula (non-seasonal): Last drawn Basic + DA × 15/26 × Years of service.
- Formula (seasonal): 7 days for each season worked.
- Rounding: Service over 6 months is rounded up to next year; less than 6 months rounded down.
- Maximum: Rs 20 lakh (statutory ceiling).
- Tax treatment: Tax-exempt up to Rs 20 lakh under Sec 10(10) for non-government employees covered by the Act.
- Forfeiture: Permitted only for termination due to fraud, riotous behaviour, moral turpitude (Sec 4(6)).
- Time limit for payment: Within 30 days of leaving; interest @ 10% p.a. for delayed payment.
Important note: This tool provides an indicative output only. It does not factor in every special provision, surcharge, exception, or recent notification. Verify with the firm before acting on any computation.
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