Gratuity Calculator (India)
Enter your last basic salary plus DA and years of service to estimate your gratuity.
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Gratuity Calculator (India) by TheCalcTools
How the Gratuity Calculator (India) works
For employers covered by the Payment of Gratuity Act, 1972, gratuity is 15 days of last drawn wages (basic plus dearness allowance) for each completed year of service, using 26 working days in a month. A final part-year of more than six months counts as a full year.
For employers not covered by the Act, the common formula uses 30 days and counts completed years only. Gratuity is normally payable after five years of continuous service, and the tax-exempt amount for private-sector employees is capped at ₹20 lakh.
The formula
Worked example
Using the default values shown in the calculator:
| Last drawn monthly basic + DA | ₹60000 |
|---|---|
| Completed years of service | 12 |
| Extra months worked in the last year | 7 |
| Employer covered by the Gratuity Act? | Yes (15/26 formula, part-year over 6 months counts as a year) |
- 12 years and 7 months: the part-year is over six months, so 13 years count.
- Gratuity = 15 × ₹60,000 × 13 ÷ 26 = ₹450000.
Result:
| Gratuity | ₹450000 |
|---|---|
| Years counted | 13 |
| Tax-exempt part (limit ₹20 lakh) | ₹450000 |
| Taxable part | ₹0 |
| Eligible (5 years of service)? | Yes |
Frequently asked questions
Does HRA count in gratuity?
No. Only basic salary and dearness allowance are used.
What does the new Code on Social Security change?
The labour codes include gratuity provisions, including shorter eligibility for fixed-term employees. Check the rules notified for your employer and state.
Sources and further reading
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This calculator gives estimates for information only. It is not tax or legal advice. Tax rules change and depend on your circumstances, so check current rules or ask a qualified professional. See our disclaimer.