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Estimate the gratuity amount you are entitled to receive from your employer at the time of retirement or resignation.
Include Basic Salary and Dearness Allowance only.
Minimum 5 years required for eligibility.
Generally, an employee is eligible for gratuity only after completing 5 years of continuous service with the same employer.
The Formula
Applies to organizations with 10 or more employees. A month is considered as 26 working days.
Applies to other organizations. A month is considered as 30 calendar days for calculation.
Gratuity is a monetary benefit given by an employer to an employee in recognition of their long-term service to the organization. It is governed by the Payment of Gratuity Act, 1972.
For government employees, the entire gratuity amount is tax-free. For private-sector employees, the least of the following is exempt from tax:
Gratuity is calculated only on your Basic Salary and Dearness Allowance (DA). Other components of your CTC like HRA, Special Allowance, or Bonus are not included.
If you resign or leave before completing 5 years of continuous service, you are generally not entitled to receive any gratuity, unless it's a case of death or permanent disability.
If you have served for more than 6 months in your final year, it is rounded off to the next full year. For example, 5 years and 7 months is treated as 6 years.
Yes, gratuity is a separate benefit paid at the time of leaving the organization (retirement, resignation, or termination) and is not part of your monthly take-home pay.