Total Gratutiy Payable 0
A Gratuity Calculator is an online tool that helps employees estimate the gratuity amount they will receive after completing at least five years of continuous service in an organization. The calculator considers key factors such as last drawn salary, years of service, and gratuity calculation formula as per the Payment of Gratuity Act, 1972.
For example, if an employee’s last drawn salary is ₹50,000 and they have completed 10 years of service, the calculator quickly determines the gratuity amount they are entitled to receive. This tool simplifies the manual calculation process and helps employees plan their post-retirement finances effectively. It is particularly useful for those preparing for financial security after leaving their jobs.
Using the Jainam Gratuity Calculator is straightforward:
For example, if an employee’s last drawn salary is ₹60,000 and they have 12 years of service, the calculator will instantly display the total gratuity payable based on the standard formula.
This tool helps employees quickly check their gratuity eligibility and plan their post-retirement funds or job transition benefits. Since it is an automated tool, users get instant and accurate results without manual calculations.
The formula for gratuity calculation under the Payment of Gratuity Act, 1972 is:
Gratuity = (Last Drawn Salary×15×Years of Service) / 26
Where:
For example, if an employee's last drawn salary is ₹50,000 and they have worked for 10 years, the gratuity will be:
(50,000×15×10) / 26 = ₹2,88,462
This formula applies to employees covered under the Gratuity Act. Those not covered may follow their company's specific policies.
A Gratuity Calculator helps employees estimate their retirement benefits in advance. It provides:
For example, if an employee with a last salary of ₹70,000 has 15 years of service, they can check how their gratuity amount increases by working additional years. This helps them decide whether to continue in their job or take retirement.
The calculator is particularly useful for employees looking for financial stability after retirement or those planning job changes.
A Gratuity Calculator offers several benefits, including:
For instance, if an employee earns ₹80,000 per month and has 20 years of service, the calculator instantly shows their expected gratuity amount, helping them plan future investments, tax savings, and financial security.
It is especially useful for individuals who want to negotiate severance packages or retirement benefits.
An employee is eligible for gratuity under the Payment of Gratuity Act, 1972, if they:
For example, if an employee has completed 4 years and 6 months, they are not eligible for gratuity. However, if they complete 4 years and 7 months (rounding off to 5 years), they may qualify based on the employer’s policy.
Gratuity taxation depends on the type of employee:
For example, if an employee receives ₹25 lakh, only ₹20 lakh is tax-free, and the remaining ₹5 lakh is taxable as per income tax slabs.
Generally, an employee must complete 5 years to be eligible for gratuity. However, there are exceptions:
For example, if an employee has 4 years and 11 months of service and resigns, they may not qualify for gratuity unless their company has a flexible policy.
Employers cannot refuse gratuity if the employee meets the eligibility criteria under the law. However, gratuity may be forfeited in the following cases:
For example, if an employee is legally terminated for fraud, the company may not be required to pay a gratuity. However, an employee resigning after 5+ years of service must be paid gratuity as per the law.
If an employer refuses or delays gratuity payment, the employee can:
As per the law, gratuity must be paid within 30 days of the employee leaving the company. If delayed, the employer may have to pay interest on the due amount.
For example, if an employee's gratuity amount is ₹5 lakh, and the employer delays payment by 6 months, they may have to pay interest along with the gratuity amount.
Yes, most online Gratuity Calculators are free to use. They help employees estimate their gratuity payout based on salary, tenure, and employer policies.
An employee must complete at least five years of continuous service in an organization to be eligible for gratuity, except in cases of death or disability.
Gratuity is not interest-based but is calculated using a fixed formula under the Payment of Gratuity Act. The employer, however, may invest gratuity funds at their discretion.
Gratuity is calculated using the formula:
Gratuity = (Last Drawn Basic Salary + DA) × 15/26 × No. of Years of Service.
For non-government employees, it is capped at ₹20 lakh.
Gratuity is calculated based on the last drawn basic salary plus dearness allowance (DA) but does not include other components like HRA, bonuses, or incentives.
Yes, if the company shuts down, employees are still entitled to gratuity. It is considered a statutory obligation, and payments are secured under the Payment of Gratuity Act.
Generally, gratuity is given after five years of service. However, in cases of death or permanent disability, it is paid regardless of the service period.
For government employees, gratuity is fully tax-exempt. For private sector employees, gratuity is tax-free up to ₹20 lakh under Section 10(10) of the Income Tax Act.
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