Gratuity Calculator
Calculate your gratuity amount based on your last drawn salary and years of service.
Service Details
Calculation Logic
Formula: (15 * Salary * Years) / 26
Rounding: Service of more than 6 months is rounded to the next full year.
Gratuity Estimate
Quick Scenarios & Settings
Gratuity Rules Summary
- Eligible after continuous employment of 5 years or more.
- A 15-day salary is calculated for every completed year of service (or part thereof exceeding six months).
- Gratuity amount is fully tax-exempt up to ₹20 Lakhs for private employees.
Understanding Gratuity Calculations
Gratuity is a lump sum amount that an employer pays to an employee as a token of appreciation for the services rendered to the company. It is usually paid at the time of retirement, resignation, or termination.
In India, the Payment of Gratuity Act, 1972, governs the payment of gratuity. It is applicable to employees who have completed at least five years of continuous service with the same employer.
The formula for calculating gratuity is (15 * Last Drawn Salary * Years of Service) / 26. The last drawn salary includes Basic salary and Dearness Allowance (DA).