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