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Payment of Gratuity Act, 1972 (Section 4(2))

Statutory Gratuity Calculator & Tax Exemption

Calculate your statutory gratuity payout using the official 15/26 formula. Includes tenure rounding (> 6 months = 1 year), 5-year vesting rule, and the ₹20,00,000 tax-free exemption limit under Section 10(10).

Employment Law Advisory
Total Statutory Gratuity Payable
₹3,00,000

Service: 7 yrs 8 mos (Rounded to 8 years) | Base: ₹65,000/mo

Tax-Free Exemption (Sec 10(10))
₹3,00,000
100% Tax-Exempt (Max ₹20L)
Taxable Portion
₹0
Zero Tax Liability

Service & Wage Inputs

₹

Note: HRA, conveyance, and special allowances are excluded from the gratuity base.

Covered under Gratuity Act 1972
Standard for organizations with 10+ employees (26 working days divisor)

Statutory Formula Breakdown (Sec 4(2))

(15 × Basic × N) / 26
Daily Wage Rate (Basic / 26)Standard Indian working days per calendar month
₹2500.00 / day
15 Days' Wages per Year of Service(15 × ₹65,000) / 26
₹37,500
Effective Number of Completed Years7 years + 8 months (> 6 months rounded up to next year)
8 Years
Calculated Statutory Gratuity₹37,500 × 8
₹3,00,000

Mandatory 30-Day Payment Deadline & 10% Interest

Under Section 7(3) of the Payment of Gratuity Act, 1972, the employer must disburse the gratuity amount within 30 days from the date it becomes payable. If not paid within 30 days, the employer is statutorily mandated under Section 7(3A) to pay compound interest at the rate of 10% per annum from the due date till payment.

Delay or denial of gratuity by employer?Send Form I / Demand Notice