Gratuity Calculator India 2026
Calculate your estimated gratuity amount based on your last drawn Basic Salary + Dearness Allowance and total years of service.
What is Gratuity?
Gratuity is a statutory social security benefit paid by an employer to an employee in recognition of long and continuous service. The provisions relating to gratuity are governed under Chapter V of the Code on Social Security, 2020.
Gratuity Formula
Gratuity = (Last Drawn Salary × 15 × Completed Years of Service) ÷ 26
For gratuity purposes, salary generally means Basic Pay plus Dearness Allowance (DA).
Eligibility for Gratuity
- Generally payable after completion of five years of continuous service.
- Payable upon resignation, retirement, superannuation, death, or disablement.
- In case of death or disablement, the five-year condition is generally not applicable.
- Fixed-term employees may be entitled to gratuity on a pro-rata basis as per applicable provisions.
Important Points
- Service exceeding six months is generally rounded off to the next completed year.
- The statutory ceiling presently considered is ₹20 lakh.
- The actual gratuity amount may vary based on applicable laws, notifications, employer policies, and judicial interpretations.
Frequently Asked Questions (FAQs)
Can I receive gratuity if I resign?
Yes. Employees who satisfy the eligibility conditions may receive gratuity upon resignation.
Is gratuity taxable?
Tax treatment depends on the employee category and prevailing Income Tax provisions.
How are service years rounded off?
Where the period beyond completed years exceeds six months, it is generally treated as one additional completed year for gratuity calculation.
Disclaimer
This gratuity calculator provides an indicative estimate only and should not be construed as legal advice. Actual gratuity entitlement shall be governed by the Code on Social Security, 2020, applicable rules, notifications, employment terms, and judicial decisions.
