Gratuity Calculation Help Needed: Can Anyone Share a Simple Formula?

Hi there,

I need a formula for gratuity calculation. Please help me.

Thanks,
Lokesh

Hi Lokesh,

The Gratuity Formula is as follows:
Last Basic Salary + DA earned / 26 * 15 * Number of years worked.

The conditions to be met are:
1) Minimum of 5 years of service.
2) The above formula is applicable to monthly salary employees.

Gratuity amounts exceeding rupees 3.6 Lacs will be taxable.

Regards,
Amit Seth.

Dear sir,

Please clarify the gratuity payable to an employee in the event of his death before completing five years of service (only 1.5 to 2.0 years in service). His salary was Rs. 5000.00 per month.

Could you kindly calculate the gratuity amount for two years?

Regards,
ARbindo

Hi,

Since you have not clarified whether the amount of Rs. 5000/- is the basic or gross salary, the gratuity amount would be calculated using the formula that Amit has mentioned above.

Katayna

I resigned from my services. I was working as a personal secretary to the Executive Director. I started my employment on 01/05/2001 and resigned on 31/05/2017, accumulating a total of 16 years of service.

My basic salary is Rs. 15,570/-, and DA is 375. Therefore, I calculated my gratuity as follows: 15,570 + 375 = 15,945 x 15 x 16 / 26 = 1,47,184 would be my gratuity amount. However, I received a cheque of Rs. 1,29,360/- only. When I approached my accounts department for clarification, they mentioned that they are giving and calculating it in the same manner.

Question about Gratuity Calculation

My question is, should I request the formula that they used for the calculation? Are there different formulas to calculate gratuity other than the one I used? I would appreciate it if someone could guide me as I need clarification.