A Gratuity Calculator is a free online tool that estimates the gratuity amount payable to an employee based on the Payment of Gratuity Act, 1972 formula — using last drawn salary, years of service, and employer type.

It applies the statutory formula: (Basic+DA) × 15 × Years / 26 for covered employers, or / 30 for non-covered employers. It also checks eligibility, applies the partial-year rule, and shows tax exemption details.

Any employee who has completed at least 5 years of continuous service with the same employer is eligible. The 5-year minimum is waived in case of death or permanent disablement.

For covered employers: Gratuity = (Basic+DA) × 15 × Years / 26. For non-covered employers: Gratuity = (Basic+DA) × 15 × Years / 30. Partial year of 6+ months rounds up to a full year.

Yes, for retirement and resignation. However, the 5-year minimum is waived in cases of death or permanent disablement — the nominee or employee receives gratuity regardless of service duration.

Yes. Gratuity is payable upon resignation (after 5 years), superannuation, death, or disablement — not just at retirement. You do not have to wait until formal retirement age.

For government employees, gratuity is fully tax-free (no limit). For private employees covered under the Act, up to ₹20 lakh is tax-exempt under Section 10(10)(ii). Any amount above ₹20 lakh is taxable.

The statutory maximum gratuity under the Payment of Gratuity Act is ₹20,00,000 (₹20 lakh), effective from March 2018. Government and PSU employees have no upper ceiling.

For private employees with covered employers: (Basic+DA) × 15 × Years / 26. The tax exemption is limited to ₹20 lakh. Any excess above ₹20 lakh is added to taxable income.

Government employees receive gratuity based on the same formula but the entire amount is fully tax-exempt under Section 10(10)(i) with no upper limit on exemption.

Gratuity is calculated on Basic Salary + Dearness Allowance (DA). HRA, special allowances, bonus, and other allowances are excluded from the gratuity base.

Yes. The Payment of Gratuity Act specifically includes Dearness Allowance (DA) in the salary base for gratuity calculation, in addition to basic salary.

If you resign before completing 5 years of continuous service (and reason is not death or disablement), you are not eligible for statutory gratuity under the Payment of Gratuity Act. However, some employers may offer ex-gratia payments as a goodwill gesture.

Non-covered employers who voluntarily offer gratuity typically use the 15/30 formula (15 days salary per year based on 30-day month). The Payment of Gratuity Act does not legally mandate gratuity for such employers, but many follow a similar policy contractually.

The Payment of Gratuity Act, 1972 is a central labour law that mandates employers with 10+ employees to pay gratuity to eligible employees at separation. It prescribes the formula, eligibility conditions, maximum limits, and dispute resolution mechanisms.

This calculator implements the exact 15/26 and 15/30 statutory formulas, applies the 5-year eligibility rule, handles the 6-month partial year rounding, and calculates tax exemption per Section 10(10). Results closely match professional HR and CA calculations.

An online gratuity calculator saves time, eliminates manual computation errors, instantly checks eligibility, applies the correct formula for your employer type, and generates a printable report — all in seconds.

Employers may offer gratuity higher than the statutory minimum but cannot pay less. Many employers maintain separate gratuity funds with LIC or private insurers. Some offer enhanced gratuity as part of their CTC package.

Yes. After calculating, click the Print button to generate a professional printed report including inputs, results, formula used, eligibility status, and legal disclaimer. PDF export is also available.

Yes, completely free. No sign-up required, no data collected, no hidden charges. All calculations run privately in your browser or via your website's secure server.