Gratuity Calculator
Calculate gratuity amount
Your Employment Details
For employees covered under the Payment of Gratuity Act, 1972
Basic salary + Dearness Allowance (if applicable)
Need at least 5 years of continuous service to qualify
Your Gratuity Amount
About Gratuity Calculator
The Gratuity Calculator helps you estimate the lump sum amount you'll receive when leaving a job after 5+ years of continuous service. Under the Payment of Gratuity Act, 1972, employers must pay this benefit to eligible employees.
Whether you're planning retirement, switching jobs, or just curious about your benefits, our calculator shows your estimated gratuity amount, tax-free portion (up to ₹20 lakhs), and taxable amount.
How to Use This Gratuity Calculator
Step 1: Enter your last drawn basic salary + DA (Dearness Allowance).
Step 2: Enter your total years of service (including months).
Step 3: Click "Calculate Gratuity" to see your estimated amount.
Step 4: View total gratuity, tax-free portion, and taxable amount.
Step 5: Use the Reset button to clear all inputs and calculate a different scenario.
Why Use a Gratuity Calculator?
✓ Retirement Planning
Know exactly how much you'll receive when you retire. Plan your post-retirement finances with accurate gratuity estimates.
✓ Job Switch Decision
If you're 4+ years into a job, calculate if waiting for 5 years is worth the gratuity amount you'd receive.
✓ Tax Planning
Gratuity up to ₹20 lakhs is tax-free. Amount above ₹20 lakhs is taxable. Plan your taxes accordingly.
✓ Know Your Rights
Many employees don't know they're entitled to gratuity after 5 years. Calculate what your employer owes you.
Gratuity Eligibility Criteria
- ✓Minimum 5 years continuous service with same employer (doesn't need to be consecutive years at same location — transfers within same company count).
- ✓Applicable on resignation, retirement, or death (family receives on death).
- ✓Company with 10+ employees must provide gratuity by law. Smaller companies may still offer voluntarily.
- ✓Even if terminated (except for misconduct causing damage/loss), gratuity still payable after 5 years.
Gratuity Tax Rules (Section 10(10))
- • Government Employees: Entire gratuity amount is tax-free (no upper limit for central/state govt employees).
- • Private Sector Employees: Gratuity up to ₹20 lakhs is tax-free. Any amount above ₹20 lakhs is added to your taxable income.
- • Exemption Formula: Lower of (Actual gratuity received, ₹20 lakhs, Calculated amount as per formula).
- • Death/Disability: Gratuity received by family is tax-free with no upper limit.
Gratuity vs Other Retirement Benefits
| Benefit | Eligibility | Tax-Free Limit |
|---|---|---|
| Gratuity | 5+ years service | ₹20 lakhs |
| EPF | Any service period | ₹5 lakhs (employee share) |
| Superannuation/Pension | Depends on scheme | Partial exemption |
What is Gratuity and Why Should You Care?
Gratuity is basically your employer saying "thanks for sticking around" in cash form. You get it after 5+ years with the same company. The government mandates it under the Payment of Gratuity Act, so most companies have to pay it. It's a nice lump sum when you retire or move to a new job.
Gratuity Formula & Example
Gratuity = (Last drawn salary × 15 × Years of service) ÷ 26
Example: ₹50,000 basic salary, 10 years of service → (50,000 × 15 × 10) ÷ 26 = ₹2,88,461
Note: The last year counts as a full year if you've worked more than 6 months. Less than 6 months? That half-year doesn't count toward gratuity calculation.