Gratuity Calculator

Any employee (permanent, temporary, part-time, or piece-rated) who has completed 5 years of continuous service with an employer is eligible. In case of death or disability, the 5-year rule is waived. The establishment must have 10 or more employees, and once crossed, the Act continues to apply even if staff count drops below 10.

For employees covered under the Payment of Gratuity Act in the private sector, the maximum gratuity is ₹20 lakh (enhanced from ₹10 lakh in 2018). For government employees, there is no upper cap. Employers can voluntarily pay more (ex-gratia), but the statutory ceiling limits the mandatory obligation.

The Payment of Gratuity Act specifies 26 working days in a month, computed by excluding the 4 Sundays (weekly offs) from 30 days. This gives 15/26 as the fraction — i.e., 15 days' pay per year of service. For non-covered employees, the denominator is 30, giving slightly lower gratuity.

Gratuity received by government employees is fully tax-free. For private sector employees covered under the Act, the least of the following is exempt: (a) actual gratuity received, (b) ₹20 lakh, (c) 15 days' salary × years of service. The surplus, if any, is taxable as salary. For non-covered employees, exemption is limited to ₹10 lakh.

Yes — but only for employees covered under the Payment of Gratuity Act. If the last year of service includes 6 or more months, it is counted as a full additional year. For example, 10 years 7 months = 11 years. This rounding rule does not apply to non-covered or government employees, where only completed years count.

Under the Act, gratuity must be paid within 30 days of it becoming payable. If delayed beyond 30 days, the employer must pay simple interest at the prescribed rate (currently 10% p.a.) from the due date until actual payment.