Gratuity Calculator (India)

Compute gratuity entitlement using the statutory 15/26 formula, service rounding rules, and Section 10(10) ₹20 Lakh tax-exemption split.

Estimated Total Gratuity
₹4,41,346.15
Calculated for 9 rounded years using 15/26 formula
Tax-Exempt Gratuity (Sec 10(10)) ₹4,41,346.15
Taxable Portion (Exceeding ₹20L) ₹0.00
Effective Service Years Used 9 years
Formula Denominator 15 / 26 days
Inputs
₹ / mo
Basic Pay plus Dearness Allowance (excludes HRA and bonuses).
years
Full years worked with the employer (5+ years required for routine eligibility).
months
For covered establishments, >6 months rounds up to the next full year.
Establishments with 10+ employees are covered under the Act.
Results & Graph
Estimated Total Gratuity
₹4,41,346.15
Calculated for 9 rounded years using 15/26 formula
Tax-Exempt Gratuity (Sec 10(10))
₹4,41,346.15
Up to ₹20,00,000 statutory cap
Taxable Portion (Exceeding ₹20L)
₹0.00
Effective Service Years Used
9 years
Formula Denominator
15 / 26 days

Tax-Exempt vs. Taxable Gratuity Split

Comparison against the ₹20,00,000 Section 10(10) exemption ceiling
Graph 1 • Tax-Exempt vs. Taxable Gratuity Split Comparison against the ₹20,00,000 Section 10(10) exemption ceiling
Tax-Exempt Gratuity: 441,346 INRTaxable Excess Above ₹20L: 0 INR Tax-Exempt Gratuity 441,346 INR Taxable Excess Above ₹20L 0 INR
Graph 2 • Proportional Share Ring Net vs. tax/interest share
TOTAL 441.3k Tax-Exempt Gratuity 441.3k (100.0%)
Graph 3 • Projected Payout / Corpus Across Service & Tenure Horizons Statutory benchmark comparison across brackets or years
0 863.9k 1.73M 5 Yrs: 319,976 320.0k 5 Yrs 10 Yrs: 639,952 640.0k 10 Yrs 15 Yrs: 959,928 959.9k 15 Yrs 20 Yrs: 1,279,903 1.28M 20 Yrs 25 Yrs: 1,599,879 1.60M 25 Yrs
Summary: Total gratuity is ₹4,41,346.15, of which ₹4,41,346.15 is tax-exempt and ₹0.00 is taxable.
Summary: With a last drawn Basic + DA salary of ₹85,000.00/month and 8 years, 7 months of service (9 effective years under the covered 15/26 rule), your calculated gratuity is ₹4,41,346.15. Up to ₹4,41,346.15 is tax-exempt under the ₹20,00,000 statutory limit.

Formula & Mathematical Methodology: Payment of Gratuity Act, 1972 Section 4(2) Formula

Gratuitycovered = (Basic + DA) × 1526 × Y,   Gratuityuncovered = (Basic + DA) × 1530 × Y
Covered: Gratuity = (Basic + DA) × (15 / 26) × RoundedYears; Uncovered: Gratuity = (Basic + DA) × (15 / 30) × CompletedYears
  • Basic + DA: Last drawn monthly Basic Salary plus Dearness Allowance
  • 15 / 26: 15 days of wages out of 26 working days in a month

Rounding: Service tenure > 6 months in the final year rounds up to the next integer year for covered establishments.

Worked Example: ₹85,000 Basic+DA with 8 Years, 7 Months Service (Covered Establishment)

An employee leaves a covered company after 8 years and 7 months with a last drawn Basic + DA of ₹85,000.

  1. Because 7 months exceeds 6 months, tenure rounds up from 8 to 9 effective years.
  2. Gratuity = ₹85,000 × 15 × 9 ÷ 26 = ₹4,41,346.15.
  3. Since ₹4,41,346.15 is below the ₹20,00,000 ceiling, 100% is tax-exempt.
Result: Total gratuity is ₹4,41,346.15 (100% tax-exempt under Section 10(10)).

Frequently Asked Questions

Does the 5-year minimum service rule apply if an employee passes away or becomes disabled?

No. Under Section 4(1) of the Payment of Gratuity Act, the 5-year continuous service requirement is waived in the event of death or disablement.

Finance & Investing • India Payroll & Retirement Benefits Guide

How to Use the Gratuity Calculator (India): Practical Guide & Visual Analysis

Estimate your lump-sum gratuity benefit upon leaving an employer after 5+ years of service, comparing establishments covered under the Payment of Gratuity Act (15/26) versus uncovered employers (15/30). Whether you are researching india gratuity formula, 15/26 gratuity calculator, gratuity tax exemption calculator, payment of gratuity act, this interactive tool helps you calculate statutory gratuity payout under the Payment of Gratuity Act, 1972 (15/26 rule or 15/30 rule) and check the ₹20 Lakh tax-exempt limit.

Interpreting the 3 Custom Visual Graphs & Key Outputs

As you adjust Last Drawn Monthly Salary (Basic + DA), Completed Full Years of Service, Additional Months in Final Year, Establishment Coverage Status, the calculator immediately computes Estimated Total Gratuity (₹), Tax-Exempt Amount up to ₹20L (₹), Taxable Excess Above ₹20L (₹), Effective Service Years Used and updates all three domain-specific SVG charts in real time. Instead of relying on a single static figure, you can inspect the primary domain diagram, component breakdown, and multi-point trajectory curve to see how changing your inputs shifts the final result. Use the Compare (up to 3 scenarios) button to evaluate side-by-side variations before making a decision.

Real-World Benchmark & Planning Tips (India (Payment of Gratuity Act, 1972))

In our benchmark scenario (₹85,000 Basic+DA with 8 Years, 7 Months Service (Covered Establishment)), Total gratuity is ₹4,41,346.15 (100% tax-exempt under Section 10(10)). Keep in mind that applies the current ₹20,00,000 lifetime tax-exempt ceiling under Section 10(10) of the Income Tax Act for non-government employees. For related calculations in Finance & Investing, explore EPF Calculator (Employees Provident Fund), PPF Calculator (Public Provident Fund), SWP Calculator (Systematic Withdrawal Plan).