Gratuity Calculator
Estimate your gratuity payout from last drawn salary and years of service, and see how much is tax-free under the Payment of Gratuity Act.
Covered employers use a divisor of 26 (working days); non-covered use 30. In a covered job, a final year with more than 6 months counts as a full year.
Exemption is capped at ₹20,00,000 across your career (non-government employees).
FAQ
How is gratuity calculated?
For employers covered under the Payment of Gratuity Act, gratuity = (15 × last drawn Basic + DA × years of service) ÷ 26. Employers not covered by the Act use a divisor of 30 instead of 26.
How many years do I need to get gratuity?
You generally need 5 continuous years of service with the same employer. This 5-year condition is waived only in case of death or permanent disability.
Does a partial final year count?
In a covered job, if your final year has more than 6 months of service it is rounded up to a full year — so 10 years 7 months counts as 11 years. Non-covered employers count only completed years.
Is gratuity taxable?
For non-government employees, gratuity is tax-free up to a lifetime limit of ₹20 lakh (least of actual gratuity, the formula amount, and ₹20 lakh). Anything above the cap is added to your taxable income. Government employees receive fully tax-free gratuity.
What salary is used in the formula?
Your last drawn monthly Basic salary plus Dearness Allowance (DA). Allowances like HRA, bonus and overtime are not included.