Gratuity Calculator

Estimate gratuity from last drawn basic plus DA and completed years of service.

Enter the values and press Calculate.

Your result will show here.

About this calculator

Gratuity is a lump sum linked to how long you worked and the salary at the end. For an employer covered by the Payment of Gratuity Act, the familiar formula is 15 days’ salary for each completed year, with the month treated as 26 working days. That is salary × 15 × years / 26.

Employers outside the Act are often estimated with a 30-day month instead: salary × 15 × years / 30. Use the checkbox to switch. Your appointment terms can be more generous than the statute. They cannot be discovered by this page.

A part of a year above six months is commonly counted as a full year for covered employees. The rounding box does that when the decimal part of the years you typed is 0.5 or more.

Tax exemption is capped. The default ceiling stored for this site is ₹20 lakh. If Parliament changes it, an admin should update the setting and the note on this page. The calculator will not change that ceiling by itself.

Gratuity formula

Covered by the Payment of Gratuity Act:
Gratuity = last drawn salary × 15 × years / 26

Not covered:
Gratuity = last drawn salary × 15 × years / 30

Salary means basic pay plus DA. Years are completed years. More than six extra months can be rounded up when that box is ticked.
The estimated exempt portion is the lower of the gratuity and the ceiling saved in settings (default ₹20,00,000).

Example: ₹50,000 for 10 years

Last drawn basic plus DA of ₹50,000 and 10 completed years, employer covered by the Act, no extra rounding.

Gratuity is ₹2,88,461.54. The exempt portion is the same because it is below the ₹20,00,000 ceiling.

The working is 15 × 50,000 × 10 / 26.

₹50,000 salary, 10 years, covered

15 × 50,000 × 10 / 26

₹2,88,461.54

How to use

Enter last drawn monthly basic plus DA.
Enter completed years. Use a decimal only if you want the half-year box to see the extra months, for example 10.6.
Leave the rounding box on if service above six months in the final year should count as another year.
Leave the Act box on for an employer covered by the Payment of Gratuity Act.
Press Calculate.

Important notes

Five years of continuous service is the usual qualifying period, with exceptions such as death or disablement.
The tax-exempt ceiling in this tool defaults to ₹20,00,000. Change it in Admin → Settings only when the law changes, and record why.
This page does not know your employer’s trust rules or a better contractual formula.
The amount is an estimate of the statutory formula, not a settlement letter.

FAQ

When is gratuity normally paid?

After five years of continuous service, and in some cases earlier if the employee dies or is disabled. This tool still shows a number below five years and warns you.

What salary is used?

Last drawn basic pay plus dearness allowance, as a monthly figure.

What is the 26 in the formula?

The Act treats a month as 26 days. Fifteen days of that month, multiplied by the years, is the gratuity.

Is the whole amount tax-free?

Only up to the ceiling. The result shows an estimated exempt portion limited by the ceiling in settings, defaulting to ₹20,00,000.

Disclaimer

Results are estimates for general information. Verify important decisions with an appropriate professional or official source. The employer’s working and the tax-exempt limit in force on the date of payment decide the final amount.

Last updated 5 October 2026.