Enter your last drawn salary (basic+DA) and years of service to calculate gratuity using the 15/26 formula.
β οΈ This calculator provides an estimate based on India's government/financial schemes using publicly available 2026 rates. Actual amounts may differ due to scheme changes or individual circumstances β please verify with an official source or financial advisor.
India's Payment of Gratuity Act, 1972 uses the formula Gratuity = Last drawn monthly salary (Basic+DA) Γ 15/26 Γ Years of service. The "15" represents 15 days' wages credited per completed year of service, and "26" is the assumed number of working days in a month (excluding 4 Sundays). A final partial year of 6 or more months rounds up to a full year (20y 7m β 21 years; 20y 4m stays 20 years). The statutory tax-free cap is βΉ20,00,000, and amounts above that may be taxable.
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Eligibility and Notes
Gratuity is generally paid to employees who complete 5+ years of continuous service at retirement, resignation, or superannuation (the 5-year rule is waived for death or disablement). Whether the Act applies also depends on establishment size (typically 10+ employees), so confirm your employer is covered. This calculator gives a reference estimate only β actual payouts depend on company policy and any legal amendments.
Frequently asked questions
Why is the denominator "26" in the 15/26 formula?
It represents the assumed number of working days in a month β a 4-week month minus 4 Sunday off-days leaves 26 working days. It is a fixed statutory denominator.
How exactly does the years-of-service rounding work?
If the final partial year has 6 or more completed months, it rounds up to a full year (e.g. 20y 7m β 21 years). Below 6 months, it rounds down (e.g. 20y 4m β 20 years).
Will the βΉ20,00,000 tax-free cap stay the same?
This has been the statutory cap since 2019, but there have been discussions about raising it. Check with your labour ministry or HR department for the latest limit at the time of payout.