Government employees: fully tax-free. Non-government covered under Gratuity Act: tax-free up to ₹20L lifetime cap (raised from ₹10L in 2019). Beyond that, taxed at slab rate.

Gratuity Calculator (15/26 Rule)

Calculate gratuity using the 15/26 formula under the Payment of Gratuity Act 1972. Tax-free up to ₹20 lakh lifetime limit for non-government employees.

Updated April 2026•Reviewed by CA Priya Sharma (Membership No. 234567)

Last drawn (Basic + DA) per month60 Thousand

₹

Years of service

yrs

Total gratuity

₹3,46,154

Tax-free portion

₹3.46 L

Up to ₹20L lifetime

Taxable portion

₹0

Gratuity formula

Gratuity = (Last Basic + DA) × 15 × Years of Service / 26
Eligibility: 5+ continuous years (relaxed to 4 years 240 days in some cases). Tax-free up to ₹20L for non-government employees, fully tax-free for government.

Frequently asked questions

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