How is gratuity calculated in India?

Gratuity = (Basic Salary + DA) × 15 ÷ 26 × Number of Years of Service. For non-covered companies: 15 × Last Salary × Years ÷ 30. Minimum 5 years of continuous service required.

What is the tax exemption limit on gratuity?

For government employees: gratuity is fully tax-exempt. For private employees: tax-exempt up to ₹20 lakh (raised from ₹10L in 2019). The excess over ₹20L is taxable as salary.

What happens to gratuity if I resign before 5 years?

Gratuity is forfeited if you leave before 5 years of continuous service. Exception: death or disability — gratuity is paid regardless of tenure. If 4 years 240+ days worked, some courts have ruled it counts as 5 years.

Gratuity CalculatorFY 2026-27

Calculate gratuity payable on retirement or resignation under the Payment of Gratuity Act 1972.

Quick Summary: Gratuity Calculator

A Gratuity Calculator computes the gratuity amount payable on resignation or retirement using the formula: (Basic+DA) × 15 ÷ 26 × Years of service. Minimum 5 years of service is required. The amount is tax-exempt up to ₹20 lakh under Section 10(10) of the Income Tax Act.

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Regulatory Disclaimer · FY 2026-27

Last verified May 2026

Statutory Disclosure

Nature:Calculator platform and is NOT a SEBI-registered Investment Adviser. All calculations are indicative.

Risk:"Investments in securities market are subject to market risks. Read all related documents carefully before investing."

Consult a SEBI-registered IA or CA for personalised advice.

9 out of 10 traders in F&O incurred net losses (SEBI 2023). Tax estimates based on IT Act 2025. Trezoriq is not liable for financial decisions based on results.