Gratuity Deducted Monthly from My CTC for 4 Years: Can I Claim It Back? Seeking Advice

My previous employer included gratuity in my CTC and deducted the same on a monthly basis for approximately 4 years. Can I claim my gratuity as part of my CTC? Requesting assistance on this matter.

Even though gratuity is shown to be a part of CTC, you cannot claim it until you complete 5 years of continuous service in the organization.

One needs to understand that the term CTC is a cosmetic figure used to present the company in a better position to employees than it actually is. It stands for Cost to the Company and should not be equated with the Gross Salary of the employee. Only when it is shown under the term Gross Salary can you challenge the employer; otherwise, no.

As far as the Payment of Gratuity Act, 1972 is concerned, it is quite clear that one must complete a full 5 years to stake a claim for gratuity, as rightly pointed out.

Thanks and Regards

Okay, but if the company deducted an amount as "Gratuity" from the gross salary, then?

Understanding Cost to Company (CTC)

Cost to company (CTC) is a term for the total salary package of an employee. It indicates the total amount of expenses an employer (organization) spends on an employee during one year. It is calculated by adding the salary to the cost of all additional benefits an employee receives during the service period.

Gratuity and Its Claim Conditions

So, understood salary is a part of CTC, and additional benefits will be the investment from the employer. Gratuity is contributed by the employer either through an insurance policy or a gratuity fund, but an employee can only claim it after completion of 5 years of service, not on 1-2-3-4 years.

Thanks & regards

By virtue of CTC norms, one cannot get the amount back if they are leaving before the eligibility period. Only those who have contributed from their salary towards gratuity can get the amount back.

Regards