Gratuity Calculator from Salary Slip
Estimate your gratuity based on your basic pay and years of service. Free calculator using your actual salary slip data.
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How It Works
Gratuity is a lump-sum payment made by an employer to an employee as recognition of their service. Under the Payment of Gratuity Act 1972, employees who have completed at least 5 years of continuous service are eligible. Yet many employees are unsure of how much they're entitled to or whether their employer's calculation is correct.
The formula is straightforward: (Last drawn basic salary × 15 × years of service) ÷ 26. The "15" represents 15 days of salary per year of service, and "26" represents the working days in a month. Upload your latest salary slip and enter your years of service to calculate your exact entitlement.
For employees covered under the Gratuity Act, the maximum tax-free gratuity is ₹20 lakh. Amounts above this threshold are taxable. Government employees have different rules under the Central Civil Services (Pension) Rules.
Frequently Asked Questions
How is gratuity calculated?
The formula is: (Last drawn basic salary × 15 × years of service) ÷ 26. For example, with a basic salary of ₹50,000 and 10 years of service, gratuity = (50,000 × 15 × 10) ÷ 26 = ₹2,88,462.
Am I eligible for gratuity before completing 5 years?
Generally no. However, exceptions apply in cases of death or permanent disability, where gratuity is payable regardless of years of service.
Is gratuity taxable?
For private-sector employees covered under the Gratuity Act, gratuity up to ₹20 lakh is fully exempt from income tax. Amounts exceeding this limit are taxable in the year of receipt.