💰 Gratuity Calculator
Calculate your gratuity amount based on the Indian Payment of Gratuity Act, 1972. Get instant results and plan your retirement finances effectively.
Calculation Results
Important Information
- • Maximum gratuity amount is ₹20,00,000 (20 lakh)
- • Gratuity up to ₹20 lakh is exempt from income tax
- • Minimum 5 years of continuous service required
- ⚠️ Amount exceeds maximum limit - excess will be ex-gratia payment
Calculation Breakdown
About Gratuity
Gratuity is a lump sum payment made by employers to employees as a token of appreciation for their services. It is governed by the Payment of Gratuity Act, 1972, and is applicable to employees who have completed at least five years of continuous service with the same organization.
Key Features:
- Minimum 5 years of continuous service required
- Maximum amount capped at ₹20 lakh
- Tax-free up to ₹20 lakh
- Payable on retirement, resignation, death, or disablement
- Different calculation methods for covered and non-covered employees
Calculation Formula:
- Covered under Gratuity Act: (Years of Service × Basic Salary + DA × 15) ÷ 26
- Not covered under Gratuity Act: (15 × Last Drawn Salary × Tenure) ÷ 30
Frequently Asked Questions
Disclaimer
This calculator provides estimates based on the Indian Payment of Gratuity Act, 1972. The actual gratuity amount may vary based on your employer's specific policies, local regulations, and other factors. Please consult with your HR department or a financial advisor for precise calculations and advice.