India · payroll · Payment of Gratuity Act
Gratuity calculator for India.
Enter your last drawn basic pay plus dearness allowance and your length of service to estimate gratuity under section 4(2) of the Payment of Gratuity Act, 1972.
Your service
Result
Fill in the service details and press Calculate gratuity.
The gratuity formula
For an employee covered by the Payment of Gratuity Act, 1972, section 4(2) sets gratuity at fifteen days’ wages for each completed year of service, where a month is taken as 26 working days: last drawn monthly wage × 15 ÷ 26 × completed years. Wages here mean basic pay plus dearness allowance. A part of a year of more than six months is counted as a full year.
Worked example: wage 26,000, 10 years: 26,000 × 15 ÷ 26 × 10 = 150,000.
Section 4(3) caps the gratuity at an amount fixed by the Government, and section 4(1) generally requires five years of continuous service, except on death or disablement. Those figures and the treatment of fixed-term staff have changed over time, so this page asks you to enter the ceiling and does not assume one. Employers not covered by the Act often use a different formula in their policy. Source: Payment of Gratuity Act, 1972, sections 4(1) to 4(3), India Code. Checked October 4, 2026.
Frequently asked questions
Is the 15/26 figure the same for everyone?
It applies to employees covered by the Act. If your employer is not covered, the rules in your contract or policy apply.
What counts as wages?
Basic pay plus dearness allowance. Allowances such as HRA and one-off bonuses are not included.
Is gratuity taxable?
Tax treatment depends on your employment type and current law. Confirm with a tax professional or the Income Tax Department.
Estimate, not legal advice
Your employer or the controlling authority decides the amount payable. Confirm the current ceiling and eligibility rules before relying on this result.