Gratuity Calculator
Gratuity is a statutory monetary benefit provided by employers to employees who have completed at least 5 years of continuous service under the Payment of Gratuity Act, 1972.
Input Calculation Parameters
₹
Years
Calculation Results
Total Gratuity Payable
0
Tax-Exempt Status (Up to ₹20L)
0
How the Calculation Works
Gratuity Formula = (15 x Last Drawn Basic Salary x Completed Tenure Years) / 26.
Worked Example
Here is a step-by-step example calculation for ₹80,000 Basic Salary with 10 Years Service:
| Parameter | Value |
|---|---|
| Gratuity | ₹4,61,538 |
Scenario Analysis
Comparing different tenures, interest rates, or investment horizons:
| Scenario Label | Key Metric |
|---|---|
| 10 Years Service | Gratuity: ₹4,61,538 |
Common Mistakes to Avoid
- Counting total salary instead of Last Drawn Basic + DA component.
Frequently Asked Questions (FAQs)
What is the tax exemption limit for gratuity in India?
Gratuity up to ₹20 Lakh is tax-exempt for non-government covered employees under Section 10(10).
Authoritative Sources & Regulatory References
Author: SmartPaisa Financial Research Team
Reviewer: Reviewed by Financial Engineering Team
Last Reviewed: 2026-08-17
Financial Disclaimer: This calculator provides estimates for educational purposes only based on standard mathematical formulas and current Indian regulatory guidelines. Actual returns, taxes, or EMI payments may vary depending on bank policies, market volatility, or individual tax brackets. Consult a SEBI-registered investment advisor or Chartered Accountant (CA) before making financial decisions.
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