Analyze the costs and returns associated with Gratuity Calculator India
Calculate your exact gratuity entitlement based on years of service and last drawn basic salary under the Payment of Gratuity Act 1972.
Real-World Scenarios
Formula: (15 × Last Salary × Years) / 26. Tax-free up to ₹20L for private sector employees.
A senior employee nearing retirement can plan investment of the entire gratuity amount in a liquid fund immediately.
Professional Strategy Insights
- Gratuity up to ₹20L is fully tax-exempt for private sector employees. Plan your resignation or retirement timing to maximize gratuity collection.
- Government employees have no upper cap on tax-free gratuity—an important consideration in pension planning.
Frequently Asked Questions
What is the gratuity formula?
Gratuity = (Last Basic + DA) × 15/26 × Number of Years of Service. Partial years above 6 months are rounded up to the next year.
Is gratuity taxable in India?
No, up to ₹20L is tax-exempt for private sector. For government employees, the entire amount is tax-free.
eCalcy Editorial Team
Verified ExpertFinance Research & Editorial Board, eCalcy
Financial Technology Specialists · RBI, SEBI & IRS Verified Calculators
Reviewed: April 2026
Every formula and editorial guide on eCalcy is reviewed by the eCalcy Editorial & Research Board and cross-referenced against RBI circulars, SEBI regulations, and the Income Tax Department guidelines. eCalcy is NOT a SEBI-registered investment advisor — all tools are educational planning aids only.
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