Gratuity Calculator India
Calculate your gratuity eligibility on exit, or estimate your future gratuity based on expected salary growth and retirement date.
Employment Details
Gratuity is calculated on Basic Salary + DA, not full CTC. If you do not know your Basic Salary, estimate it as a percentage of CTC.
Leave as 0 if DA is not part of your salary.
As of today: 7 yrs 5 mos of service
Generally eligible as of today, subject to applicable rules.
Exit Details
If blank, calculated gratuity is used for tax exemption illustration.
Enter Details to Calculate
Fill in your salary and service details, then click Calculate Gratuity.
Understanding Gratuity in India
What is gratuity?
Gratuity is a statutory lump-sum payment made by an employer to an employee as a token of gratitude for long service. It is governed primarily by the Payment of Gratuity Act, 1972 for most private sector employees. It becomes payable on retirement, resignation after completing the required service period, death, or disablement.
How gratuity is calculated in India
For employees covered under the Payment of Gratuity Act: Gratuity = (Basic + DA) × 15 × Completed Years ÷ 26. If excess months after completed years exceed 6, the year is rounded up. For employees not covered by the Act, the formula uses ÷ 30 instead of ÷ 26. Generally, a minimum of 5 years of continuous service is required for eligibility (except in cases of death or disablement).
How the future gratuity estimate works
In estimate mode, this calculator projects your Basic + DA forward to the expected exit date using compound annual growth. Alternatively, you can enter the expected future Basic + DA directly. The Quick Scenarios panel also shows estimated gratuity at common service milestones (5, 7, 10 years) so you can see how your gratuity builds over time. All figures are indicative.
Why Basic + DA matters
The gratuity formula uses Basic Salary + Dearness Allowance as the wage base, not the gross salary or CTC. HRA, special allowances, performance bonuses and other components are excluded. This means the actual gratuity can be significantly lower than the CTC-equivalent calculation employees often expect. Use the "Estimate Basic from CTC" option if you are unsure of your Basic salary.
Tax exemption on gratuity
For private sector employees covered under the Payment of Gratuity Act, the exempt amount is the least of: (1) actual gratuity received, (2) gratuity calculated as per the Act's formula, and (3) the lifetime exemption limit of ₹20,00,000. Government employees are fully exempt. The taxable portion (if any) is added to total income and taxed at the applicable slab rates.
Important Notes
- This calculator is indicative and based on common gratuity rules in India.
- Eligibility generally requires 5 years of continuous service, except in cases of death or disablement.
- For employees covered under the Payment of Gratuity Act, gratuity is commonly calculated as Basic + DA × 15/26 × completed years of service.
- Future gratuity is an estimate and depends on salary growth, actual retirement date, company policy and applicable law.
- Tax exemption is subject to conditions and the overall lifetime exemption limit of ₹20,00,000.
Disclaimer
This calculator provides approximate gratuity estimates based on standard interpretations of the Payment of Gratuity Act, 1972. Actual gratuity payable may differ based on your employment contract, applicable state laws, government service rules, company policy, and other legal provisions. Tax treatment may vary based on your individual circumstances. This calculator should not be treated as legal or financial advice. Consult your HR department or a qualified professional for exact figures.