Kukurai,
Please go thro\' the latest amendments in the Gratuity Act yourself and look into the answers given by seniors. You will understand that as per Act, maximum Gratuity payable is Rs.10 lakhs by an employer ( not together by all employers, as some body posted), but which does not prohibit an employer from paying more amount as Gratuity. Tax exemption will be available only for Rs.10 lakhs and the rest if any, only attracts IT, which has to be deducted from gratuity payable. There is no confusion on this.
Dr.Gopan
From India, Kochi
32Please go thro\' the latest amendments in the Gratuity Act yourself and look into the answers given by seniors. You will understand that as per Act, maximum Gratuity payable is Rs.10 lakhs by an employer ( not together by all employers, as some body posted), but which does not prohibit an employer from paying more amount as Gratuity. Tax exemption will be available only for Rs.10 lakhs and the rest if any, only attracts IT, which has to be deducted from gratuity payable. There is no confusion on this.
Dr.Gopan
From India, Kochi
gratuity is a statutory payment to be made by the employer to the employee.
any employee who has served for an organization five years of his/her continuous service i.e., in the same organization and it may be with a transfer within the group companies is eligible for gratuity.
minimum gratuity year is completion of five years service
15 days salary is payable (basic + DA) per year, therefore, five years(minimum Years) X 15 days salary OR the entire years of completion of years. .
that means, if an employee's completed years X 15days latest/last salary drawn by an employee.
For your knowledge, nowadays no young employees, who are especially technically/educationally qualified, are not all completing two years of continuous service in a same company/organization owing to job opportunities availability.
From India, Pune
any employee who has served for an organization five years of his/her continuous service i.e., in the same organization and it may be with a transfer within the group companies is eligible for gratuity.
minimum gratuity year is completion of five years service
15 days salary is payable (basic + DA) per year, therefore, five years(minimum Years) X 15 days salary OR the entire years of completion of years. .
that means, if an employee's completed years X 15days latest/last salary drawn by an employee.
For your knowledge, nowadays no young employees, who are especially technically/educationally qualified, are not all completing two years of continuous service in a same company/organization owing to job opportunities availability.
From India, Pune
Dear Mr. Varghese Mathew & Mr. Prasoon,
I am sorry, it was a misunderstanding on my part. There was a rule in the Government Sector that if any person joins from a Govt. sector to another Govt. sector or PSU and transfers his gratuity from his previous employer to the new employer, his gratuity used to be calculated for the whole period of service including previous organisations and the total amount of gratuity used to be restricted to the ceiling. I applied the analogy and suggested. Thanks for highlighting the mistake.
Regards
From India, Mumbai
I am sorry, it was a misunderstanding on my part. There was a rule in the Government Sector that if any person joins from a Govt. sector to another Govt. sector or PSU and transfers his gratuity from his previous employer to the new employer, his gratuity used to be calculated for the whole period of service including previous organisations and the total amount of gratuity used to be restricted to the ceiling. I applied the analogy and suggested. Thanks for highlighting the mistake.
Regards
From India, Mumbai
Dear members,
As per the Payment of Gratuity Act 1972
Section 4 (3) The amount of gratuity payable to an employee shall not exceed ten lakh rupees.
(5) Nothing in this section shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer.
C THANGAVEL
COIMBATORE
From India, Chennai
As per the Payment of Gratuity Act 1972
Section 4 (3) The amount of gratuity payable to an employee shall not exceed ten lakh rupees.
(5) Nothing in this section shall affect the right of an employee to receive better terms of gratuity under any award or agreement or contract with the employer.
C THANGAVEL
COIMBATORE
From India, Chennai
Dear!!
I want to give one input that yes upto 10 lakh is exempted amount, but this 10 lakh is throughout employees full professional career not he/she can get from only one employer.
Before processing the Gratuity, you must take an undertaking that how much gratuity has the employee taken from previous companies earlier taxable or non taxable, suppose it comes around Rs 3 lac and he has to be paid Rs 12 lac now. Then you have to process 7 lac as exempted and 5 lac taxable amout.
BR
Jaykant Singh
From India, Delhi
I want to give one input that yes upto 10 lakh is exempted amount, but this 10 lakh is throughout employees full professional career not he/she can get from only one employer.
Before processing the Gratuity, you must take an undertaking that how much gratuity has the employee taken from previous companies earlier taxable or non taxable, suppose it comes around Rs 3 lac and he has to be paid Rs 12 lac now. Then you have to process 7 lac as exempted and 5 lac taxable amout.
BR
Jaykant Singh
From India, Delhi
Community Support and Knowledge-base on business, career and organisational prospects and issues - Register and Log In to CiteHR and post your query, download formats and be part of a fostered community of professionals.
New Rate of Sta mp Duty & Registration - Fees Payable .p df
Accounts payable process.doc