Gratuity Calculator
Calculate gratuity payable under the Payment of Gratuity Act 1972.
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Gratuity Calculator
Use the formula and worked example below to calculate manually.
Overview
Gratuity is a lump-sum payment made by an employer to an employee as a token of gratitude for their service. This calculator computes the gratuity amount you are eligible for under the Payment of Gratuity Act, 1972.
How to use this calculator
- Enter your last drawn monthly basic salary (basic + DA).
- Enter the total years of service completed.
- Select whether your company is covered under the Payment of Gratuity Act (most companies with 10+ employees are).
- The calculator shows the gratuity payable.
Understanding the inputs & results
Basic + DA
Basic salary plus Dearness Allowance — the components used to calculate gratuity.
Years of service
The total number of completed years of continuous service with the employer. If you have served more than 6 months beyond a completed year, it rounds up.
Gratuity Act coverage
The Payment of Gratuity Act applies to organisations with 10 or more employees. A different formula applies to non-covered organisations.
The formula
Gratuity under the Gratuity Act
Gratuity = (Basic + DA) × 15/26 × Years of Service
15 days' salary for each completed year (26 working days in a month). Maximum gratuity payable is ₹20 lakh under the Act. For non-Act organisations: Gratuity = (Basic + DA) × 15/30 × Years.
Worked example
Basic + DA = ₹60,000/month, 10 years of service (Act-covered company).
- Gratuity = 60,000 × 15/26 × 10.
- = 60,000 × 0.5769 × 10 = ₹3,46,154.
✓ Gratuity payable ≈ ₹3,46,154.
Frequently asked questions
This calculator uses standard Act provisions. Actual entitlement may vary by company policy, employment agreement, and amendments to the Act. Consult HR or a legal professional for specifics.