Gratuity Calculator
Calculate your gratuity amount based on last drawn salary and years of service.
Covers both government and private sector formulas.
Gratuity Amount
Gratuity is a lump-sum benefit paid by employers to employees upon leaving, based on tenure.
For employees covered under the Payment of Gratuity Act:
Gratuity = (Last Drawn Salary × 15 × Years of Service) / 26
Where:
- Last Drawn Salary = Basic salary + Dearness Allowance
- 15 = 15 days of wages for each year
- 26 = Working days in a month
- Minimum 5 years of continuous service required
For employees NOT covered under the Act:
Gratuity = (Last Drawn Salary × 15 × Years of Service) / 30
Example: Last salary of $5,000/month with 10 years of service:
- Covered under Act: ($5,000 × 15 × 10) / 26 = $28,846
- Not covered: ($5,000 × 15 × 10) / 30 = $25,000
Maximum gratuity limit (India): ₹20,00,000 (approximately $24,000). Any amount above this is taxable.