Gratuity Calculator

Enter your basic pay plus dearness allowance (DA) for the last month you worked, not your CTC or gross salary. The calculator multiplies it by 15/26 and by your years of service. With the default inputs, ₹50,000 a month for 10 years, the result is ₹2,88,462.

Since the Code on Social Security, 2020 took effect on 21 November 2025, there is a catch for pay structures with a small basic. "Wages" must be at least 50% of your total remuneration; if the excluded allowances go above half, the excess is added back to wages. Suppose your total monthly pay is ₹80,000 and basic + DA is only ₹30,000. Half of ₹80,000 is ₹40,000, so ₹10,000 of allowances is added back and your gratuity wage becomes ₹40,000.

The Code applies prospectively, so ask HR how your service before 21 November 2025 is being treated.

The calculator takes whole years, so do the rounding yourself. Only completed years count, but a final part-year of more than 6 months counts as a full year. Six months or less is dropped.

• 7 years 7 months → enter 8. At ₹50,000, gratuity is ₹2,30,769.
• 7 years 5 months → enter 7. At ₹50,000, gratuity is ₹2,01,923.

Those few months make a ₹28,846 difference, so check your exact joining date and last working day before you resign. Permanent employees need 5 years of continuous service to qualify; the minimum does not apply on death or disablement.

Under the Code, a fixed-term employee earns pro-rata gratuity after just 1 year of service, instead of 5. The formula is the same. On a 2-year contract with a last drawn basic + DA of ₹30,000, gratuity is ₹34,615; after 1 year it is ₹17,308.

The years field's arrows start at 5, but you can type 1, 2 or 3 directly and the result updates. If your contract was renewed without a break, check with HR whether the periods are being added together.

For private-sector employees, gratuity is tax-free up to ₹20 lakh over your whole working life, across all employers. The ₹25 lakh figure you may have seen applies to central government employees' gratuity and to leave encashment, not to private-sector gratuity. Government employees' gratuity is fully exempt.

Most people never reach the limit. It takes a long career and a high basic: ₹1,00,000 a month for 35 years gives ₹20,19,231, of which ₹19,231 would be taxable at your slab rate. If you have received gratuity from an earlier employer, subtract it from ₹20 lakh to find how much exemption you have left. Employees not covered by the Code have a different exemption formula based on half a month's average salary for each completed year.