Gratuity Calculator - Calculate Your Gratuity Amount

💡 Free Gratuity Calculator: Calculate your gratuity amount as per Payment of Gratuity Act 1972. Get instant results based on your basic salary, years of service, and dearness allowance.

Basic Salary (₹)

Dearness Allowance (₹)

Years of Service

Additional Months

Gratuity Amount

₹0

Last Drawn Salary

₹0

Eligible Service

0 Years

📊 Gratuity Formula: Gratuity = (Last Drawn Salary × 15 × Years of Service) ÷ 26. Minimum 5 years of service required for eligibility.

🎯 Gratuity Calculator Features

✅ Calculate as per Payment of Gratuity Act 1972
✅ Include basic salary and dearness allowance
✅ Consider years and months of service
✅ Instant and accurate calculations
✅ Check eligibility criteria
✅ Share calculation results

How Gratuity Calculator Works

Gratuity is a financial reward that employers pay to employees who have a long-term commitment. It is governed through the Payment of Gratuity Act 1972 in India and is calculated according to the salary that was last drawn and the number of years of service.

Key Components:

The Last Drawn Salary: Basic salary + Dearness allowance
Year of Service: 5 years or less necessary for eligibility
Formula Factor: Payroll: 15 days for every year of service
Work Days: Based on the 26 working days of a month

Gratuity Example:


        Basic Salary: Rs50,000

        Dearness Allowance: Rs10,000

        Year of Service: 15 Years

        Gratuity: Rs5,76,923

Eligibility Criteria:

🎯 Service Duration: Minimum 5 years of continuous service
📈 is applicable to: Organizations with 10plus employees
💰 Maximum Limit: Rs20 lakh (as per current act)
🚀 Payment Time: Within 30 days of resignation/retirement

📈 Gratuity Growth Over Years

See how your gratuity amount grows with years of service

🥧 Salary vs Gratuity Breakdown

Visual breakdown of annual salary vs gratuity amount

Annual Salary

Gratuity Amount

💰 Service Years vs Gratuity Analysis

Track how gratuity eligibility and amount changes with service years

What is a Gratuity Calculator?

An Gratuity Calculator a finance tool to help employees determine the amount of gratuity they're legally entitled to from their employers in accordance with the Act on Payment of Gratuities 1972. It calculates the gratuity on the basis of the amount of their last salary (basic salary plus dearness allowance) and the number of years of service.

Who could profit by the Gratuity Calculator?

employees: Calculate expected gratuity amount prior to the date of retirement or resignation
HR professionals: You can quickly calculate gratuity liabilities for employees.
Financial planners Provide assistance to clients planning their retirement savings, including gratuities
Employers Make estimates of gratuity provision for budgeting and ensuring compliance

Advantages to using Gratuity Calculator

Exact Calculation: Based on the Official Payment of Gratuity Act 1972 formula
Instant Results Instant calculation, no manual calculations
Eligibility Verify: Automatically verifies minimum 5 years of service requirements
A Free Software: No cost for using the calculator
Plan Aid: Helps in retirement and financial planning

What is the Gratuity Calculator function?

The calculator utilizes the traditional calculation of gratuity: (Last Drawn Salary x 15 x Years Service) + 26. It takes the salary that was drawn as the amount of the basic salary and dearness allowance. Calculates the amount based on the working hours of 26 days in a month, and employs the 15-day pay factor for each calendar year.

When to use the Gratuity Calculator

Calculating the your expected earnings
Before resigning, you must be aware of the gratuity entitlement
HR departments handle calculations of employee gratuities
Investment and financial planning
The impact that changes to salary on gratuities

Important Information regarding Gratuity

Ineligibility Five years continuous, minimum is required
Maximum Capacity: The current maximum amount of gratuities is 20 lakh rupees
Tax treatment: Up to Rs20 lakh is tax-free to employees of the government
Date of Payment: The payment must be made within 30 calendar days from the date of eligibility
Application: Companies with 10 or more employees are required to provide gratuities

Frequently Asked Questions (FAQ)

What is gratuity? How do you calculate it?

Gratuity is a lump-sum paid for employees by their employers in exchange for their service for a long time. It is calculated by using an equation: (Last Drawing Salary years of service) 26 which means that the last salary drawn includes basic salary as well as dearness allowance.

How long is the minimal period that is required to earn gratuities?

According to the Payment of Gratuity Act 1972 the employee must have completed at least 5 years of continuous employment to be qualified to receive gratuities. In the event the employee dies or is disabled this requirement is not met.

What is the maximum amount of gratuities?

The maximum gratuity amount that can be paid is Rs20 lakh, as per the payment of Gratuity (Amendment) Act 2018. The limit was raised by a factor of 10 lakh.

Is gratuity tax-deductible in India?

For employees of the government, gratuity up to a maximum of Rs20 lakh is tax-free. For employees in the private sector, gratuities are tax-free up to 20 lakh or the amount determined as per the Act or whichever is lower. Anything more than this amount is tax deductible.

What is the best time to pay gratuities from the company?

In accordance with the Payment of Gratuity Act, gratuities must be paid in 30 days of the date on which it becomes payable. If it takes longer the employer will be liable to be liable for interest on the deferred amount.

Can gratuities be refunded by the employer?

Gratuities can be taken away in cases of misconduct, dismissal for reason, or when the employee's employment is terminated in the event of violence, disruptive or disorderly behavior. But, a partial forfeiture might be a possibility in certain situations.