What is the minimum service required for gratuity?
Employees must complete at least 5 years of continuous service with the employer (or 4 years and 240 working days in judicial rulings).
Gratuity payout based on last drawn salary and years served.
Calculates statutory retirement and resignation gratuity payouts for employees completing five or more years of continuous service.
Gratuity = (15 × Last Drawn Salary × Years of Service) / 26
Last drawn salary = Basic Pay + Dearness Allowance (DA). 26 represents working days per month. 15 represents days of wages per year.
Inputs: Last Drawn Basic + DA = ₹75,000 | Completed Service = 10 Years
Summary: Service = 10 Years | Last Basic = ₹75,000 | Total Statutory Gratuity = ₹4,32,692
Employees must complete at least 5 years of continuous service with the employer (or 4 years and 240 working days in judicial rulings).
Gratuity is tax-exempt up to a lifetime ceiling of ₹20 Lakhs for non-government employees covered under the Act.
The 5-year continuous service condition is waived, and full gratuity is paid to legal nominees.