Calculate your estimated gratuity payout under the Payment of Gratuity Act 1972. Private sector, government, and non-covered employees. Tax exemption status shown.
| Last drawn salary (Basic + DA) | — |
| Effective service years | — |
| Formula divisor | — |
| Formula applied | — |
| Gratuity amount | — |
Example: Basic + DA = ₹50,000/month, Service = 10 years 8 months (rounds to 11 years, as months > 6)
Gratuity = (50,000 × 15 × 11) ÷ 26 = ₹3,17,308
| Employee Category | Tax Exemption Limit |
|---|---|
| Government employees (Central, State, PSU) | Fully exempt — no limit |
| Private sector — covered under Gratuity Act | Up to ₹20 lakh tax-free |
| Private sector — not covered under Act | Up to ₹20 lakh tax-free* |
*For non-covered employees, exemption is least of: gratuity received, ₹20 lakh, or half-month salary per year. Source: Income Tax Department guidance.
Employers must ensure Basic + DA ≥ 50% of total CTC. This directly increases gratuity payouts since gratuity is calculated on Basic + DA. If your employer was keeping your basic salary artificially low, it must now be restructured — meaning your gratuity base and PF contributions both increase.
Maintained by the RupeeCalc editorial workflow. Last checked: 29 May 2026. This page gives informational estimates only; verify official sources, your own documents, and a qualified professional before filing taxes, taking loans, investing, invoicing, or making compliance decisions.