How Much Gratuity Will You Get? Quick Calculation Guide
Calculate your exact gratuity amount in 2 minutes. Simple formula, worked examples for different salary levels, and what affects your final payout.
Want to know your gratuity amount before resigning or retiring? Here's the quick formula and ready-to-use calculations.
The Gratuity Formula
Gratuity = (15 × Last Drawn Salary × Years of Service) ÷ 26
Where:
- Last Drawn Salary = Basic Pay + Dearness Allowance (DA)
- Years of Service = Completed years (6+ months rounds up)
- 26 = Working days in a month
Get your exact amount: Use our Gratuity Calculator.
Quick Calculation Tables
By Monthly Salary (5 Years Service)
| Basic + DA | Gratuity Amount |
|---|---|
| ₹20,000 | ₹57,692 |
| ₹30,000 | ₹86,538 |
| ₹40,000 | ₹1,15,385 |
| ₹50,000 | ₹1,44,231 |
| ₹60,000 | ₹1,73,077 |
| ₹75,000 | ₹2,16,346 |
| ₹1,00,000 | ₹2,88,462 |
By Years of Service (₹50,000 Salary)
| Years | Gratuity Amount |
|---|---|
| 5 years | ₹1,44,231 |
| 7 years | ₹2,01,923 |
| 10 years | ₹2,88,462 |
| 15 years | ₹4,32,692 |
| 20 years | ₹5,76,923 |
| 25 years | ₹7,21,154 |
| 30 years | ₹8,65,385 |
High Salary Examples
| Basic + DA | Years | Gratuity | Capped At |
|---|---|---|---|
| ₹1,50,000 | 20 | ₹17,30,769 | ₹17,30,769 |
| ₹2,00,000 | 20 | ₹23,07,692 | ₹20,00,000 |
| ₹2,00,000 | 25 | ₹28,84,615 | ₹20,00,000 |
Maximum limit: ₹20 lakh for private sector employees.
Step-by-Step Example
Your Details
- Basic Salary: ₹45,000
- DA: ₹5,000
- Service: 8 years 7 months
Calculation
| Step | Calculation | Result |
|---|---|---|
| 1. Last Drawn Salary | ₹45,000 + ₹5,000 | ₹50,000 |
| 2. Years (rounded) | 8 years 7 months → | 9 years |
| 3. Formula | (15 × 50,000 × 9) ÷ 26 | ₹2,59,615 |
Your gratuity: ₹2,59,615
What's Included in "Last Drawn Salary"?
| Included | Not Included |
|---|---|
| Basic Pay | House Rent Allowance |
| Dearness Allowance | Conveyance |
| Bonus | |
| Overtime | |
| Commission | |
| Special Allowances |
Common mistake: Many calculate gratuity on gross salary. Only Basic + DA counts.
The Rounding Rule
Service months are rounded to the nearest year:
| Service | Counted As | Reason |
|---|---|---|
| 5 years 4 months | 5 years | Less than 6 months → round down |
| 5 years 6 months | 6 years | 6+ months → round up |
| 7 years 11 months | 8 years | 6+ months → round up |
| 10 years 0 months | 10 years | Exactly 10 years |
This can make a big difference. If you're at 4 years 10 months, waiting 2 more months gets you gratuity!
Eligibility Requirements
| Requirement | Details |
|---|---|
| Minimum service | 5 years (exceptions for death/disability) |
| Organization size | 10+ employees at any point in last 12 months |
| Employment type | Regular employees (contract workers under new rules) |
Common Salary Scenarios
IT Professional
| Component | Amount |
|---|---|
| CTC | ₹15,00,000 |
| Basic (40% of CTC) | ₹6,00,000 |
| Monthly Basic | ₹50,000 |
| DA | ₹0 |
| Service | 6 years |
| Gratuity | (15 × 50,000 × 6) ÷ 26 = ₹1,73,077 |
Manufacturing Employee
| Component | Amount |
|---|---|
| Monthly Basic | ₹25,000 |
| DA | ₹8,000 |
| Last Drawn Salary | ₹33,000 |
| Service | 12 years |
| Gratuity | (15 × 33,000 × 12) ÷ 26 = ₹2,28,462 |
Government Employee (Similar Calculation)
| Component | Amount |
|---|---|
| Basic Pay | ₹80,000 |
| DA (50% of Basic) | ₹40,000 |
| Last Drawn | ₹1,20,000 |
| Service | 30 years |
| Gratuity | (15 × 1,20,000 × 30) ÷ 26 = ₹20,76,923 |
| Capped at | ₹25,00,000 (govt limit) |
Year-by-Year Gratuity Growth
For someone with ₹50,000 Basic + DA:
| At Year | Gratuity If You Leave | Increment from Previous |
|---|---|---|
| 5 | ₹1,44,231 | First eligibility |
| 6 | ₹1,73,077 | +₹28,846 |
| 7 | ₹2,01,923 | +₹28,846 |
| 8 | ₹2,30,769 | +₹28,846 |
| 9 | ₹2,59,615 | +₹28,846 |
| 10 | ₹2,88,462 | +₹28,846 |
Each additional year adds ~₹29K (at this salary level).
When Salary Increases
If your salary increased recently, gratuity is based on last drawn salary only:
| Scenario | Previous Salary | Current Salary | Gratuity Based On |
|---|---|---|---|
| Just promoted | ₹40,000 | ₹55,000 | ₹55,000 |
| Annual increment | ₹50,000 | ₹52,000 | ₹52,000 |
Tip: Wait for salary revision before resigning if it's coming soon.
Tax on Gratuity
| Employee Type | Tax-Free Limit |
|---|---|
| Government employees | Fully exempt |
| Private sector (Gratuity Act covered) | Up to ₹20 lakh |
| Private sector (Non-Act) | Up to ₹20 lakh |
Example: Tax Calculation
| Detail | Amount |
|---|---|
| Gratuity received | ₹22,00,000 |
| Exempt amount | ₹20,00,000 |
| Taxable amount | ₹2,00,000 |
| Tax (30% slab) | ₹60,000 + cess |
Quick Reference Card
| Salary | 5 Years | 10 Years | 15 Years | 20 Years |
|---|---|---|---|---|
| ₹25,000 | ₹72,115 | ₹1,44,231 | ₹2,16,346 | ₹2,88,462 |
| ₹40,000 | ₹1,15,385 | ₹2,30,769 | ₹3,46,154 | ₹4,61,538 |
| ₹50,000 | ₹1,44,231 | ₹2,88,462 | ₹4,32,692 | ₹5,76,923 |
| ₹75,000 | ₹2,16,346 | ₹4,32,692 | ₹6,49,038 | ₹8,65,385 |
| ₹1,00,000 | ₹2,88,462 | ₹5,76,923 | ₹8,65,385 | ₹11,53,846 |
Get your exact amount instantly: Use our Gratuity Calculator—just enter your salary and years of service.