Gratuity calculator: what you are owed when you leave.

1. Count the years of continuous service from the date of joining to the last working day.
2. If the employer is covered by the Payment of Gratuity Act and the remainder is six months or more, count it as a full year.
3. Check eligibility: five years of continuous service. Some employers, following several High Courts, accept four years and 240 days.
4. Multiply the last drawn monthly Basic + DA by 15, divide by 26, and multiply by the years counted.
5. The Act caps gratuity at ₹20,00,000, and the same amount is the lifetime limit on what is tax-free.

Date of joining

The first day of your continuous service with this employer. Service is counted from here.

It is on your appointment letter. If you moved between companies of the same group without a break, your employer may count from your first joining — ask HR.

Last working day

Your final day at work — the day your service ends. It is usually on your relieving letter.

Still working and want to know what you have built up? Pick today’s date.

Basic + DA

Your last month’s Basic salary plus Dearness Allowance (DA), if you get DA. Gratuity is worked out on these two only — not on CTC, gross or other allowances.

Both are separate lines on your payslip. Most private-sector payslips have no DA; then just enter Basic.

For example: Basic ₹38,000 and DA ₹2,000 → enter ₹40,000.

Covered by the Gratuity Act

The Payment of Gratuity Act applies to employers with 10 or more employees. A covered employer counts a month as 26 working days and rounds six months or more up to a full year. One that is not covered pays under its own policy, usually on a 30-day month.

Ten or more people work there? Choose Yes.

Qualifying service

How long you must work before gratuity is owed. The rule is five years of continuous service. Several High Courts have held that four years and 240 days is enough, and some employers follow that.

Choose “Five years” unless your employer’s policy says otherwise. The five-year rule does not apply if an employee dies or is disabled.

Years counted

Your years of service for the formula. A final part-year of six months or more counts as a full year; less than six months is dropped.

For example: 7 years and 7 months counts as 8; 7 years and 5 months counts as 7.

15 days and 26 days

Gratuity is 15 days’ wages for every year of service. The Act treats a month as 26 working days, so 15 days’ wages is 15/26 of a month’s Basic + DA.

Tax-free gratuity

Gratuity up to ₹20,00,000 is free of income tax — a limit over your whole working life, across every employer. Anything above it is taxed like salary.

Been paid gratuity by an earlier employer? That amount uses up part of the limit.

• Full and final settlement calculator

  A full and final settlement is the last month’s salary, leave encashment (Basic + DA ÷ 26 × days), gratuity after five years (Basic + DA × 15 ÷ 26 × years), plus notice pay if the employer cut the notice short or less it if the employee did, less any recoveries — and the wages are due within two working days of the last working day.

• In-hand salary calculator

  Take-home is your gross salary minus employee PF (12% of Basic, at most ₹1,800 a month on the ₹15,000 ceiling), ESI if your gross is ₹21,000 or less, professional tax and income tax — and under the new regime a salary of up to ₹12,75,000 pays no income tax at all.

• PF and ESI calculator

  PF is 12% of Basic + DA from the employee and the same from the employer — ₹1,800 each on the usual ₹15,000 ceiling, with ₹1,250 of the employer’s share going to pension — and ESI is 0.75% from the employee and 3.25% from the employer when gross pay is ₹21,000 a month or less.

Facto Lite works gratuity out in every full and final settlement, with the leave encashment and notice pay beside it. See Payroll.