Gratuity Calculator
Gratuity on last drawn basic + DA using the statutory 15/26 formula and completed years of service.
Result
- Years counted
- 10
- 0 extra months do not add a year
- Eligible under the Act
- Yes
- Five completed years of continuous service
- Ceiling applied
- No cap hit
- Notified ceiling ₹20,00,000
- Fifteen days of pay
- ₹28,846.15
- Basic + DA × 15 / 26
All figures are estimates from the inputs above, not a guarantee of returns and not advice. This is the formula for establishments covered by the Payment of Gratuity Act. Employers who are not covered, or who pay more than the Act requires, use a different basis, and the eligibility rule is relaxed on death or disablement. Rates and statutory charges change. Verify current charges with your broker, the exchange and SEBI before relying on these figures.
Estimated from the numbers you entered — not a projection of guaranteed returns. Statutory and exchange rates as of 2026-08.
About this calculator
For an establishment covered by the Payment of Gratuity Act, gratuity is fifteen days of last drawn basic plus dearness allowance for every completed year of service, taking a month as twenty-six working days. Service beyond six months in the final year counts as a full year. The factor, the divisor and the exemption ceiling are all statutory and have been revised before, so each is an editable default here rather than a fixed number.
Formula
- Gratuity = (Last drawn basic + DA) × 15 / 26 × completed years of service
- A final year of six months or more counts as one more completed year
- The amount is then capped at the notified ceiling
Frequently asked questions
Why 15 / 26?
The Act pays fifteen days of wages for each completed year and treats a month as twenty-six working days, so a day of pay is monthly basic + DA divided by 26.
Do 6 months and 20 days count as a year?
Yes. Service of six months or more in the final year is rounded up to a full year; less than six months is dropped.
Is gratuity tax-free?
Gratuity is exempt up to a notified ceiling for covered employees, and anything above it is taxable. The ceiling has been revised before, which is why it is editable here.