Hi All:
I understand that the Gratuity for any death case would be calculated based on below formula(as per Gratuity act):
Gratuity amount= (No. of year service in company + No. of service years left till his age of 58 ) * (15/26*Last drawn basic)
Points to note:
1. Gratuity amount can have a slab of Rs. 3,50,000/- and this can be relaxed if company is willing to give more compensation
2. Gratuity amount is non-taxable
Above mentioned data are completely based on compliance set by our government.
My question here is, will the Gratuity slab of Rs. 3,50,000/- is applicable even for the case of death or is there any clear instruction given somewhere (in Gratuity act) about Gratuity payable with different conditions for deceased employee about the slab amount?
i would appreciate if somebody can give me a clear indication
Regards,
Arun Kumar Vijayamoorthy
Cognizant
From India, Madras
I understand that the Gratuity for any death case would be calculated based on below formula(as per Gratuity act):
Gratuity amount= (No. of year service in company + No. of service years left till his age of 58 ) * (15/26*Last drawn basic)
Points to note:
1. Gratuity amount can have a slab of Rs. 3,50,000/- and this can be relaxed if company is willing to give more compensation
2. Gratuity amount is non-taxable
Above mentioned data are completely based on compliance set by our government.
My question here is, will the Gratuity slab of Rs. 3,50,000/- is applicable even for the case of death or is there any clear instruction given somewhere (in Gratuity act) about Gratuity payable with different conditions for deceased employee about the slab amount?
i would appreciate if somebody can give me a clear indication
Regards,
Arun Kumar Vijayamoorthy
Cognizant
From India, Madras
Dear Mr.Arun
Rs.3,50,000.00 is the maximum gratuity payable. But the Gratuity amount will varry as per the following calculation.
Wages: Wages shall consist of basic plus DA, as per last drawn salary. However allowances like bonus,commission, HRA, overtime etc. are not to be considered for calculations.
Formula:
Basic + DA
----------- X 15 X no of years of service *
26
* If the employee has complected more than 6 months, it will be treated as full year for the purpose of gratuity calculation.
There is no change for deceased employee. but u have to calculate it according to the formula.
regards
alphonse
From India, Madras
162Rs.3,50,000.00 is the maximum gratuity payable. But the Gratuity amount will varry as per the following calculation.
Wages: Wages shall consist of basic plus DA, as per last drawn salary. However allowances like bonus,commission, HRA, overtime etc. are not to be considered for calculations.
Formula:
Basic + DA
----------- X 15 X no of years of service *
26
* If the employee has complected more than 6 months, it will be treated as full year for the purpose of gratuity calculation.
There is no change for deceased employee. but u have to calculate it according to the formula.
regards
alphonse
From India, Madras
- Formula for calculating the amount of gratuity remains same. - Maximum limit is Rs. 3.5 Lakh - In case of death of a employee, only the condition of completion of 5 yrs. is not applicable. Thanks,
From India, Mumbai
From India, Mumbai
Hi Nishi, Is the formula not No. of year service in company + No. of service years left till his age of 58 in case of deceased???
From India, Ahmadabad
From India, Ahmadabad
Hai friends,
Calculation of eligible Gratuity is same in all cases , be it retirement or death. But when subscribed to Insurance linked gratuity scheme of LIC, premia towards gratuity for completed years of service and for remaining period of service are collected by LIC and there is additional coverage for the gratuity payable for the remaining period of service of a deseased employee. In that case calculation of Gratuity will be as per formula mentioned by Arun. In other cases calculation is as per message of Alphonse.
But remember, maximum Gratuity in all case is limited to Rs.3.5 lakhs.Rule4(3)
From India, New Delhi
Calculation of eligible Gratuity is same in all cases , be it retirement or death. But when subscribed to Insurance linked gratuity scheme of LIC, premia towards gratuity for completed years of service and for remaining period of service are collected by LIC and there is additional coverage for the gratuity payable for the remaining period of service of a deseased employee. In that case calculation of Gratuity will be as per formula mentioned by Arun. In other cases calculation is as per message of Alphonse.
But remember, maximum Gratuity in all case is limited to Rs.3.5 lakhs.Rule4(3)
From India, New Delhi
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SBT Vs Asst. Labour Commissioner- Gratuity dismissed employee-LTS.PD F
FORM I(Application for Gratuity by an employee).doc