Gratuity Calculator

Calculate your estimated gratuity amount payable by your employer upon exit.

Labour Codes effective 21 November 2025  |  Reviewed 8 September 2026

Employment Details

Use wage components included by the applicable statutory definition. This may differ from the “basic salary” shown in an offer letter.
The five-year condition generally applies to regular cases. Fixed-term contract expiry, death and disablement use special eligibility rules.
Eligibility, the wage base and tax treatment depend on employment facts. Verify the estimate with HR or a labour-law professional.

Your Estimated Gratuity

Total Gratuity Payable

₹ 2,01,923

Based on 8 calculated years of service.

Understanding Gratuity Calculation in India

Standard Covered-Establishment Estimate

Under the standard statutory formula, gratuity is estimated at 15 days of wages for each completed year of service or qualifying part. Regular cases generally round a part exceeding six months to a year. Fixed-term expiry and death cases can be calculated pro rata.

Gratuity = Eligible wages × 15 × Years ÷ 26

Example: Basic+DA ₹50,000, 10 years → (50,000 × 15 × 10) ÷ 26 = ₹2,88,462

Alternative Contractual Illustration

Some employment terms may use a 30-day contractual illustration. It is included only for comparison and should not be treated as the statutory formula.

Illustration = Wage base × 15 × Years ÷ 30

Example: Basic+DA ₹50,000, 10 years → (50,000 × 15 × 10) ÷ 30 = ₹2,50,000

Key Rules

  • Regular Cases: Five years of continuous service generally applies to resignation and retirement cases.
  • Special Cases: The five-year condition is not required for death, disablement or expiry of direct fixed-term employment; pro-rata calculation can apply.
  • Ceiling and tax: Statutory ceilings and income-tax treatment are separate from the formula and can depend on employee category and current notifications.
  • Wage context: Use the components included in the applicable gratuity wage definition, which may differ from basic salary shown in an offer letter.

Gratuity Amount Reference Table

Illustrative gratuity under the standard 15/26 formula at different wage levels and years of service.

Basic + DA / Month5 Years10 Years15 Years20 Years30 Years
₹20,000₹57,692₹1,15,385₹1,73,077₹2,30,769₹3,46,154
₹30,000₹86,538₹1,73,077₹2,59,615₹3,46,154₹5,19,231
₹50,000₹1,44,231₹2,88,462₹4,32,692₹5,76,923₹8,65,385
₹75,000₹2,16,346₹4,32,692₹6,49,038₹8,65,385₹12,98,077
₹1,00,000₹2,88,462₹5,76,923₹8,65,385₹11,53,846₹17,30,769
₹1,50,000₹4,32,692₹8,65,385₹12,98,077₹17,30,769₹25,96,154

Formula illustrations are shown before any statutory ceiling or tax treatment. Verify the limit applicable on the payment date.

Gratuity vs EPF vs Leave Encashment

FeatureGratuityEPFLeave Encashment
EligibilityGenerally 5 years; exceptions applyScheme rules applyEmployment policy/rules
Who ContributesEmployer onlyBothEmployer only
Rate15/26 per year12%+12%Basic ÷ 26
Tax treatmentCategory-specificWithdrawal rules applyCategory-specific
On Death5-yr rule waivedNominee getsPaid to nominee
LimitsCurrent notificationScheme rulesCurrent tax rules
When Can Employer Forfeit Gratuity?

Termination for riotous or violent conduct during employment

Specified offences involving moral turpitude committed in the course of employment

Willful damage to employer's property (forfeiture limited to extent of damage)

Ordinary resignation, retirement or retrenchment is not by itself a forfeiture ground

How Gratuity Appears in Your CTC

Some employers represent gratuity in CTC at approximately 4.81% of a monthly wage base under the 15/26 formula. Payment remains subject to statutory eligibility and the applicable wage definition, including special rules for fixed-term employment, death and disablement.

Gratuity as % of Basic

4.81%

per year of service

Frequently Asked Questions

For covered establishments, five years of continuous service generally applies to regular resignation or retirement. The condition does not apply in specified cases including death, disablement and expiry of direct fixed-term employment, where pro-rata treatment can apply.

The standard illustration is last drawn eligible monthly wages multiplied by 15, multiplied by eligible years, divided by 26. The applicable wage base and rounding depend on the Code on Social Security framework and employment facts.

Five years generally applies to regular resignation or retirement cases. It is not necessary in specified cases including death, disablement and expiry of direct fixed-term employment, where pro-rata calculation may apply.

An employer may show an estimated gratuity cost in CTC, often near 4.81% of the selected wage base under a 15/26 illustration. The amount actually payable depends on eligibility and the statutory wage definition.

The page references the Code on Social Security, 2020 and Labour Code implementation effective from 21 November 2025. Users should verify current rules and case-specific interpretation.

The five-year minimum is not required in death or disablement cases. Calculation and payment to the nominee or legal heir depend on the employment record and applicable rules.

This tool uses 26 for the standard statutory illustration. The optional 30-day method is provided only for comparing an alternative contractual calculation and should not be treated as a statutory conclusion.

A notified statutory ceiling may limit gratuity payable under the Code, while income-tax exemption is a separate question. Verify the current notification and employee category before relying on a ceiling or tax amount.
Reviewed 9 September 2026 Reference values can change. Verify important filings or decisions with the relevant authority.

Transparent calculation

Payroll formula and assumptions

MethodStandard estimate = eligible monthly wages × 15 × eligible service years ÷ 26
  1. Enter the wage or compensation basis requested.
  2. Apply the displayed contribution or benefit rules.
  3. Compare the estimate with the offer letter, payslip and employment facts.

Important assumption: Employer policy, employee category, wage definition and state rules can change the result.

Private by design, useful as an estimate

Most calculation and document entries are processed in this browser. HSN search terms are sent to BharatERP only to return matching references. This shared tool layer does not send entered values to analytics.

Avoid entering passwords, bank credentials or unnecessary identity data. Outputs are estimates or editable templates—not legal, tax, investment, lending or accounting advice.

Gratuity Calculator result BharatERP Payroll

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