Gratuity Calculator

Estimate gratuity as per Payment of Gratuity Act. Formula: (Salary × 15 / 26) × Years. Min 5 years of service. Max ₹20 lakh.

Gratuity PPF EPF / PF EMI SIP FD NPS Income Tax HRA

Salary (Basic + DA) per month (₹)

₹

Years of service (min 5)

yrs

Total gratuity payable

Gratuity payable₹ 2,88,462

Formula: (Last salary × 15 ÷ 26) × Years. More than 6 months in a year = one full year. Tax-exempt limit is ₹20 lakh in your lifetime.

Gratuity is a lump-sum payment an employer makes to an employee as a token of appreciation for services rendered. It is governed by the Payment of Gratuity Act, 1972 and applies to employees who have completed at least 5 years of continuous service.

What is this calculator?

A Gratuity Calculator helps you estimate the gratuity amount you will receive when you leave a job after 5+ years. You enter your last drawn salary (Basic + DA) and years of service; the calculator instantly shows the gratuity payable.

Formula

Gratuity = (Last drawn salary × 15) ÷ 26 × Number of completed years of service.

Here, 15 represents the number of days' wages payable, and 26 is the number of working days in a month. 'Last drawn salary' means Basic salary + Dearness Allowance (DA).

For employees NOT covered under the Gratuity Act:
Gratuity = (15 × Last drawn salary × Tenure) ÷ 30

Example

Suppose you worked for 15 years and your last drawn salary (Basic + DA) was ₹30,000 per month: Gratuity = (30,000 × 15 ÷ 26) × 15 = ₹2,59,615. The maximum tax-exempt gratuity is ₹20 lakh under current rules. Any amount above this is treated as ex-gratia and is taxable as per your income-tax slab. If the tenure in the final year exceeds 6 months, it is rounded up to one full year.

Benefits

✓Instantly know how much gratuity you are eligible for before switching jobs or retiring.
✓Plan your post-employment finances. Invest the gratuity wisely in FD, PPF, NPS or mutual funds.
✓Understand the ₹20 lakh statutory cap and plan taxes accordingly.
✓Compare different salary or tenure scenarios to see how gratuity grows.

Frequently Asked Questions

Is 4.5 years of service eligible for gratuity?: Generally, no. You need at least 5 years of continuous service. However, a Madras High Court ruling states that 4 years and 240 days may qualify. In case of death or disability, the 5-year rule is waived.
Is there an upper limit on the gratuity amount?: Yes. Under the Payment of Gratuity Act, the maximum gratuity payable is ₹20 lakh. Anything beyond that is considered ex-gratia by the employer.
What does 15/26 mean in the gratuity formula?: 26 represents the projected working days in a month. The gratuity is calculated at the rate of 15 days' wages for each completed year, so per-day wage is salary ÷ 26, and half-month wage is that × 15.
Is gratuity taxable?: Government employees receive fully tax-exempt gratuity. For private employees, the least of the following is exempt: actual gratuity received, ₹20 lakh, or the eligible gratuity as per the formula. The balance is taxable as per your slab.
Do contract employees get gratuity?: If a contract employee is on the company's rolls, they are eligible. If employed through an external contractor, the contractor is responsible for paying the gratuity.

This calculator uses the standard formula under the Payment of Gratuity Act, 1972. Actual gratuity may differ based on employer policies, CTC structure, and applicable court rulings.