Calculate your gratuity amount as per Payment of Gratuity Act 1972
| Years of Service | Gratuity Amount (₹) | Tax Status | Cumulative Benefit |
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The Gratuity Calculator is an essential tool for employees to calculate their gratuity amount as per the Payment of Gratuity Act 1972. Whether you're a private sector employee or government employee, understanding your gratuity entitlement helps in better financial planning for retirement and career transitions.
Gratuity is a monetary benefit paid by employers to employees as a token of appreciation for their services. It serves as a financial cushion for employees during retirement or when leaving their job after completing eligible service years. The gratuity calculator helps determine the exact amount you're entitled to receive based on your salary and years of service.
Using our Gratuity Calculator is simple and provides instant results:
The gratuity formula as per the Payment of Gratuity Act 1972 is:
To be eligible for gratuity payment, you must meet certain conditions as per the Payment of Gratuity Act:
Understanding the tax treatment of gratuity is crucial for financial planning. The tax exemption depends on your employment type:
The entire gratuity amount received by government employees is completely exempt from income tax without any upper limit.
Tax exemption is available for the least of:
Tax exemption is available for the least of:
Consider an employee with the following details:
Calculation: Gratuity = (20 × 60,000 × 15) / 26 = ₹6,92,308
Tax Status: Fully exempt as it's below ₹20,00,000 limit
The gratuity calculation and tax exemption limits are periodically updated. Key recent changes include:
To make the most of your gratuity benefits:
You won't be eligible for gratuity if you resign before completing 5 years of continuous service, except in cases of death or disablement.
Months are rounded to the nearest year. If you've worked 6 months or more in a year, it's counted as a full year for gratuity calculation.
Yes, but only ₹20,00,000 is tax-exempt. Any amount above this limit (called ex-gratia) is taxable as per your income tax slab.
The gratuity calculator uses the standard formula as per the Act. However, some companies may have more generous policies, so check your employment terms.