Gratuity Calculator
Work out the gratuity payable from your last salary and years of service.
Basic + dearness allowance
Completed years (>6 months rounds up)
Gratuity payable
₹4,61,538
for 10 years at ₹80.0 K/month
Tax-free amount
₹4.62 L
₹4,61,538
Taxable amount
₹0
₹0
How this is calculated
Formula: Gratuity = (15 × last drawn monthly salary × years of service) ÷ 26, where salary is basic + dearness allowance. A part-year over 6 months counts as a full year.
Gratuity is tax-free up to ₹20 lakh for covered private employees; any excess is taxable. Eligibility is generally after 5 years of continuous service.
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Frequently asked questions
How is gratuity calculated?
For employees covered by the Payment of Gratuity Act, gratuity = (15 × last drawn monthly salary × years of service) ÷ 26, where salary is basic + dearness allowance. A part-year over 6 months counts as a full year.
Is gratuity tax-free?
Gratuity is exempt from tax up to ₹20 lakh (for covered private employees). Any amount above that is taxable. Government employees enjoy full exemption.
When am I eligible for gratuity?
Generally after completing 5 years of continuous service with an employer, payable on resignation, retirement or superannuation (and to nominees on death/disability, where the 5-year rule is waived).
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