Who is eligible for gratuity?

Employees who complete five years of continuous service with an employer covered by the Payment of Gratuity Act. The five-year rule is waived if service ends due to death or disability.

Gratuity is tax-free up to ₹20 lakh for covered private-sector employees over their lifetime. Any amount above that limit is taxed as salary income.

Gratuity Calculator

A gratuity calculator estimates the lump sum an employer owes you at exit under the Payment of Gratuity Act, payable after five years of continuous service. It is based on your last drawn basic salary plus DA and your years of service.

Last monthly salary (basic + DA)

₹

Years of service

yrs

Gratuity payable

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How is Gratuity calculated?

Gratuity = last salary (basic + DA) × 15/26 × years of service. It is tax-free up to ₹20 lakh.

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Frequently asked questions

Who is eligible for gratuity?: Employees who complete five years of continuous service with an employer covered by the Payment of Gratuity Act. The five-year rule is waived if service ends due to death or disability.
Is gratuity taxable?: Gratuity is tax-free up to ₹20 lakh for covered private-sector employees over their lifetime. Any amount above that limit is taxed as salary income.