Gratuity Calculator

Under the Payment of Gratuity Act, gratuity = (15 / 26) × last drawn monthly Basic + DA × years of service. The 26 represents working days in a month and 15 is 15 days’ wages for each completed year.

You generally need at least 5 years of continuous service. A part-year of more than 6 months counts as a full year for the calculation.

Yes. The statutory ceiling is ₹20,00,000. Any amount above this may be taxable and depends on your employer’s policy.

For government employees, gratuity is fully tax-exempt. For private-sector employees covered under the Payment of Gratuity Act, it's exempt up to the statutory ceiling (₹20,00,000) or the amount actually received, whichever is lower — amounts above that may be taxable as per current income tax rules.

The Payment of Gratuity Act applies to organisations with 10 or more employees. Employees covered by it become eligible after 5 years of continuous service (with exceptions for death or disability, where the 5-year requirement is waived).

It's your last drawn Basic pay plus Dearness Allowance (DA) — other components like HRA, bonus, and other allowances are typically excluded from the gratuity calculation base.

Generally yes, gratuity is payable on resignation too, provided you've completed the minimum 5 years of continuous service — the entitlement isn't limited to retirement or layoff scenarios.

26 represents the typical number of working days in a month under the Payment of Gratuity Act's calculation convention (excluding weekly offs), not the calendar month length — this is a fixed part of the statutory formula, not an assumption we've added.

Some employers offer gratuity under their own policy even if not statutorily required to — the calculation basis may differ from the 15/26 formula in that case, so check your specific employment terms rather than assuming this calculator applies.