Gratuity Formula

Gratuity is the collectable amount for an employee paid after the five year of service. Given here is the formula used for calculating the gratuity in India. It is calculated by adding the basic pay and dearness allowance, multiplying the resultant value with the number of years of service divided by 26. Gratuity varies for the employees who come under gratuities act and who are not under the act. Below given is the gratuity formula for gratuity calculation in India.

Gratuity Calculation Formula in India

Formula :

Gratuity Calculation= [ (Basic Pay + D.A) x 15 days x No. of years of service ] / 26


Where,

D.A = Dearness Allowance.
End of Service Benefits Eligibility :
1. Any person employed on wages/salary.
2. At the time of retirement or resignation or on superannuation, an employee should have rendered continuous service of not less than five years.
3. Payable without completion of five years only when death and disablement.

Related Calculator:

Gratuity, in other words can also be termed as TIP, an amount of charge given by the customers for any services.


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