Calculate your exact gratuity amount as per the Payment of Gratuity Act. Works for private sector, government, and seasonal employees.
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Invest with Scripbox — Zero Commission → Try Groww — India's largest MF platformFor employees covered under the Gratuity Act: Gratuity = (Last salary × 15 × Years) ÷ 26. For employees not covered or government: Gratuity = (Last salary × 15 × Years) ÷ 30. For seasonal employees: (Salary × 7 × Years) ÷ 26. "Last salary" means Basic + DA only — HRA and allowances are excluded.
Minimum 5 continuous years of service. Exception: in case of death or disability, gratuity is paid regardless of tenure. If an employee has served 4 years and 240 days (in a 6-day work week company) or 4 years and 190 days (5-day work week), it counts as 5 years per Supreme Court rulings.
Gratuity up to ₹20,00,000 is completely tax-free under Section 10(10) for employees covered under the Gratuity Act. For government employees, the entire gratuity amount is exempt from tax. Any amount exceeding ₹20 lakh is taxable as salary income.
Gratuity must be paid within 30 days from the date it becomes due. If the employer delays, they must pay simple interest at 10% per annum on the outstanding amount. The employer cannot deduct gratuity from final settlement without the employee's consent.
If the remaining months after completing full years of service are 6 months or more, they are counted as a full year. For example, 7 years 8 months = 8 qualifying years. For death/disability cases, even partial year service counts and there is no minimum service requirement.