Total Gratuity Payable To You ₹
Gratuity is a form of monetary benefit that is given to employees by their employers as a token of appreciation for their service. It is a mandatory benefit under the labor law in India, known as the Gratuity Act of 1972. This act ensures that employees who have completed a certain number of years of service are eligible to receive gratuity upon their retirement, resignation, or death. In this article, we will discuss the importance of gratuity and how to calculate the amount using a gratuity calculator.
Gratuity is a lump sum amount that is paid by an employer to an employee as a form of gratitude for their service. It is usually given at the time of retirement, resignation, or death of the employee. The amount of gratuity is calculated based on the employee's last drawn salary and the number of years they have served in the company. It is a form of financial security for employees after they leave their job.
According to the Gratuity Act of 1972, an employee is eligible to receive gratuity if they have completed a minimum of five years of continuous service with the same employer. This includes both government and private sector employees. However, in the case of death or disablement, the employee's service period can be less than five years.
Calculating the amount of gratuity can be a complex process, as it involves various factors such as the employee's last drawn salary, the number of years of service, and the employer's gratuity policy. To simplify this process, you can use a gratuity calculator. This online tool takes into account all the necessary factors and provides an accurate calculation of the gratuity amount.
Steps to Calculate Gratuity using a Gratuity Calculator
Gratuity is an important benefit for employees as it provides them with financial security after they leave their job. It also serves as a form of motivation for employees to stay with the same employer for a longer period of time. Additionally, gratuity is exempt from tax up to a certain limit, making it a valuable form of monetary benefit for employees.
As mentioned earlier, gratuity is exempt from tax up to a certain limit. According to the Income Tax Act, 1961, the maximum amount of gratuity that is exempt from tax is Rs. 20 lakhs. Any amount above this limit is taxable as per the individual's income tax slab.
As mentioned earlier, gratuity is exempt from tax up to a certain limit. According to the Income Tax Act, 1961, the maximum amount of gratuity that is exempt from tax is Rs. 20 lakhs. Any amount above this limit is taxable as per the individual's income tax slab.
