Gratuity Calculator

Gratuity = last drawn wages (basic + dearness allowance) × 15 ÷ 26 × completed years of service, with a part of a year beyond six months counted as a full year (section 53(2) of the Code on Social Security, 2020). Employees of seasonal establishments get 7 days’ wages a season. The ceiling is ₹20 lakh, unless the employer’s scheme or contract pays more.

Yes. It is a free gratuity calculator for private and government employees: no sign-up, nothing stored, and the working is shown, from the wage base and the years counted to the tax-free part. You can share the result as a link or a PDF.

Yes for the general rule: five years of continuous service with an establishment of 10 or more employees. It is waived on death, permanent disablement or the expiry of a fixed-term contract (section 53(1), second proviso); a working journalist qualifies after three years; and a fixed-term employee is paid pro rata once the contract has run one year, counted from its start (Industrial Relations Code, 2020, section 2(o); Ministry of Labour and Employment, FAQs of 16 March 2026, question 14). Some High Courts have treated four years and 240 days as five years; the Code does not say so.

Government employees: fully exempt. Everyone else: the least of the gratuity received, ₹20 lakh (a lifetime aggregate across employers) and the statutory formula amount is exempt under section 19(1) of the Income-tax Act, 2025 — Table Sl. No. 3 for government employees, Sl. No. 5 for gratuity under the gratuity law, Sl. No. 6 for any other gratuity (section 10(10) of the 1961 Act); the balance is taxed as salary. The exemption is available under both the old and the new tax regime.

From 21 November 2025 the Payment of Gratuity Act, 1972 is subsumed in Chapter V of the Code on Social Security, 2020. Three changes matter for the amount: fixed-term employees earn gratuity pro rata after one year instead of five; a deceased employee's family is paid pro rata for the period served, with no five-year test (section 53(2), third proviso); and the new wage definition counts allowances beyond 50% of total pay as wages, which raises the base for employees with a low basic. The formula, the five-year rule for permanent staff and the ₹20 lakh ceiling continue, the ceiling under the Code's saving of the 2018 notification (section 164).

Only basic pay, dearness allowance and retaining allowance are wages for gratuity — HRA, conveyance, bonus and the rest are excluded — but if those excluded components exceed half of total pay, the excess is added back (section 2(88) of the Code). On a ₹1.5 lakh CTC with ₹60,000 basic, wages for gratuity are ₹75,000, not ₹60,000.

Within 30 days of it becoming payable — the last working day, or the date of death or disablement (section 56 of the Code; section 7 of the 1972 Act). Late payment carries simple interest at the notified rate, 10% a year under the notification carried from the 1972 Act. The employee applies in writing; a late application does not defeat the claim.

Only for wilful damage to the employer’s property (to the extent of the loss), or termination for riotous or violent conduct or an offence involving moral turpitude in the course of employment (section 53(6)). Resignation, redundancy or termination for poor performance forfeits nothing.

Yes. Resignation after five years of continuous service is a termination that attracts gratuity in the same way as retirement; the notice period counts as service.