Calculate your gratuity under CCS Rules (Central Govt) or Payment of Gratuity Act (private). Full formula and tax exemption shown.
Enter your service and pay details to compute your gratuity.
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CCS Rules formula for Central Govt and Payment of Gratuity Act formula for private employees — both computed side by side.
Gratuity for Govt employees is fully tax-exempt. Private sector has a ceiling of Rs.20 lakh exempt. This calculator shows both.
Qualifying service is rounded to nearest half-year for private sector as per Payment of Gratuity Act provisions.
Gratuity is a retirement benefit paid by the employer as a reward for long service. The computation formula differs significantly between Central Government employees (covered under CCS Pension Rules) and private sector employees (covered under Payment of Gratuity Act, 1972).
Gratuity = Basic + DA × Qualifying Service × 1/4 per completed six-monthly period. Maximum qualifying service is 66 half-years (33 years). Maximum gratuity payable is Rs.25 lakh (ceiling enhanced in 7th CPC). Govt employee gratuity is fully exempt from Income Tax under Section 10(10)(i).
Gratuity = (Basic + DA) × 15/26 × Completed Years of Service. Service exceeding 6 months in the last year counts as a full year. Maximum gratuity is Rs.20 lakh (enhanced in 2018), and the excess over Rs.20 lakh is taxable. Employees must have completed at least 5 years of continuous service.
Qualifying service for gratuity includes all regular service on duty plus approved leave with pay, training periods, and maternity leave. Periods of extraordinary leave without pay do not count. Service is counted in completed half-yearly periods (6-month blocks).
Under the 7th CPC, the ceiling on gratuity for Central Government employees was raised to Rs.25 lakh from the earlier Rs.10 lakh. This ceiling is revised whenever DA rises by 50% of basic pay from the date of the previous revision.
For Central Government employees, entire gratuity is tax-free under Section 10(10)(i). For private sector employees covered under the Payment of Gratuity Act, gratuity up to Rs.20 lakh is exempt under Section 10(10)(ii). Any amount above Rs.20 lakh is taxable as income.
No. Under the Payment of Gratuity Act, a minimum of 5 years of continuous service is mandatory. For Central Government employees, gratuity on resignation requires a minimum qualifying service of 5 years, though death/disability gratuity rules are more generous.