Gratuity Calculator
Gratuity is a lump-sum benefit paid by an employer to an employee who has completed at least 5 years of continuous service. Use this calculator to find your gratuity amount using the statutory formula: (Last Salary × 15 × Years) / 26.
Frequently Asked Questions
What is gratuity and who is eligible?+
Gratuity is a statutory payment made by an employer to an employee under the Payment of Gratuity Act, 1972. Employees are eligible after completing at least 5 years of continuous service. It is payable on retirement, resignation, or in case of death/disability.
What salary is used for gratuity calculation?+
Gratuity is calculated on "Basic salary + Dearness Allowance" — not the full CTC. Other allowances like HRA, conveyance, and performance bonuses are excluded.
Is gratuity taxable?+
Gratuity is exempt from income tax up to ₹20,00,000 for employees covered under the Payment of Gratuity Act. Any amount above this limit is taxable as salary income.
What does "15/26" mean in the gratuity formula?+
15 represents 15 days of salary per year of service. 26 represents the number of working days in a month (52 weeks × 5 working days ÷ 2 fortnights = 26). So the formula effectively gives you half a month's salary per year of service.