Gratuity Calculator
Calculate your estimated gratuity amount based on last drawn salary, years of service, extra months, and whether your employer is covered under the Gratuity Act.
Enter Your Gratuity Details
Gratuity Summary
Insight
Gratuity grows with salary and years of service. Longer service can significantly increase the final payout.
Gratuity vs Annual Salary
Gratuity Growth by Service Years
Gratuity Breakdown Table
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What is Gratuity?
Gratuity is a lump-sum employee benefit paid by an employer to an employee for long-term service. It is usually payable when an employee leaves the organisation after completing the required service period.
How This Gratuity Calculator Works
This calculator estimates gratuity using your last drawn monthly salary, completed service years, extra service months, and the applicable formula. For employees covered under the Gratuity Act, the formula commonly uses 15 days salary for every completed year of service divided by 26.
Gratuity Formula
For employees covered under the Gratuity Act, the common formula is:
Gratuity = Last Drawn Salary × 15 × Years of Service ÷ 26
For employees not covered under the Act, some calculations use:
Gratuity = Last Drawn Salary × 15 × Years of Service ÷ 30
Benefits of Using a Gratuity Calculator
- Helps estimate your expected gratuity amount
- Shows how service years affect final payout
- Useful before resignation, retirement, or job change
- Helps understand the impact of salary growth
- Gives a clear breakdown of the gratuity formula
Gratuity Calculation Example
Suppose your last drawn monthly salary is ₹50,000 and you completed 5 years of service. If your employer is covered under the Gratuity Act, the estimated gratuity will be calculated as ₹50,000 × 15 × 5 ÷ 26.
Frequently Asked Questions
What salary is used for gratuity calculation?
Gratuity is usually calculated using last drawn Basic Salary plus Dearness Allowance, not total CTC or in-hand salary.
Is 5 years of service required for gratuity?
For many permanent employees, gratuity is generally linked to completing 5 years of continuous service. Exceptions may apply in cases such as death, disablement, or specific employment types.
How are extra months counted in gratuity?
Commonly, if service beyond completed years is more than 6 months, it may be rounded up to the next year. This calculator gives an option to use that rounding.
What is the difference between ÷26 and ÷30?
For employees covered under the Gratuity Act, ÷26 is commonly used because it considers 26 working days in a month. For non-covered employees, ÷30 may be used depending on company policy.
Is gratuity taxable?
Gratuity tax treatment depends on your employee type, amount received, exemption limits, and current tax rules. You should verify with your employer or tax professional.
Can gratuity be part of CTC?
Many companies show gratuity as part of CTC for cost projection, but it is usually paid only when eligibility conditions are met.
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