How is gratuity calculated?

Under the Payment of Gratuity Act gratuity = (last drawn basic + DA) × 15/26 × number of years of service (completed years).

Is there a cap on gratuity?

Yes — statutory maximum applies (e.g., ₹20,00,000 as of recent rules). This calculator shows uncapped and capped amounts.

Provide last drawn monthly Basic + DA, service duration and statutory cap (defaults to ₹20,00,000).

Last drawn Basic (monthly, ₹)

₹

Dearness allowance (DA) as % of basic

Enter DA percent if applicable (many private firms have DA ≈ 0).

Years of service

Years and months of continuous service. Gratuity is usually calculated on completed years; this tool shows both completed-year and pro-rated results.

Statutory cap (₹)

₹

Statutory maximum gratuity (commonly ₹20,00,000). Update if rules change.

Calculation method Custom days per year

Use if your company calculates gratuity differently (days per year).

Law summary

Typical formula: (Basic + DA) × 15/26 × years of service (completed years). This is an estimator only.

Completed vs Pro-rated

Many employers pay for completed years only; some offer pro-rated for months. This tool shows both.

FAQ

Is gratuity taxable?: Yes — gratuity may be taxable subject to exemptions; consult tax rules for details.

Estimated Gratuity

₹0

Shows uncapped and capped gratuity amounts; consult employer/HR for exact payout policy.

Uncapped (pro-rated)

₹0

After statutory cap

₹0