How this calculation works
This calculator uses: Gratuity = (Last Salary × 15 × Years of Service) / 26. Enter your values above to get an immediate result. Results are rounded for readability.
Using the gratuity calculator
Start by entering values in the units shown. The result updates immediately, and the shareable link preserves your inputs without creating a separate indexable page. Use this as a clear estimate and check important assumptions before relying on it.
Common questions
Who is eligible for gratuity?
Any employee who has completed at least 5 years of continuous service with the same employer is eligible for gratuity. It is payable on retirement, resignation, death, or permanent disablement.
What is the maximum tax-free gratuity?
Gratuity up to ₹20,00,000 is completely exempt from income tax. Any amount above ₹20 lakh is taxable as per your applicable slab rate.
Why is 26 used in the formula?
26 represents the number of working days in a month (excluding 4 Sundays). 15 days of salary per year of service is calculated using 26 working days/month. For employers not covered by the Act, 30 calendar days is used.
Is gratuity included in CTC?
Yes, many employers include gratuity (4.81% of basic salary) in the CTC breakup. However, it is not paid monthly — it is paid only after 5 years of service as a lump sum benefit.