Calculate gratuity under the Payment of Gratuity Act, 1972
Calculate gratuity under the Payment of Gratuity Act, 1972. For government and private employees, with 5+ years service. Tax exemption under Section 10(10). This tool is built for practical, real-world usage where speed, clarity, and reliable output matter. You can start with the default values, review the result, and then refine inputs step by step to match your exact scenario.
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Under the Act: Salary × 15 × Years / 26. Not covered: Salary × 15 × Years / 30. Salary = Last drawn Basic + DA.
You must complete at least 5 continuous years of service. Exception: death or disability — no minimum service needed.
For government employees, fully exempt. For private sector, exemption is the least of: (1) Actual gratuity, (2) ₹25 lakh, (3) Formula-based amount. Excess is taxable.
If extra months > 6, the year is rounded up. E.g., 7 years 7 months = 8 years; 7 years 4 months = 7 years.
Purpose: Calculate gratuity under the Payment of Gratuity Act with tax exemption breakdown.
Gratuity calculator implementing the Payment of Gratuity Act formula. Handles both under-Act (÷26) and not-under-Act (÷30) calculations, year rounding for service >6 months, 5-year eligibility check, and Section 10(10) tax exemption with ₹25L cap.
This page includes tool-specific method notes, edge-case guidance, and reference context to provide substantial user value beyond a basic calculator interface.