💼 Gratuity Calculator

Calculate gratuity for India (Payment of Gratuity Act 1972) & UAE (End of Service benefits)

🇮🇳 India Coverage 🇦🇪 UAE Coverage 💰 Tax Exemption ✨ Updated 2025

📋 What is Gratuity? Gratuity is a lump sum payment made by an employer to an employee as a token of appreciation for services rendered. In India, it's governed by the Payment of Gratuity Act, 1972. In UAE, it's an end-of-service benefit.

India Gratuity Calculator

Organizations with 10+ employees are covered under the Act
Basic salary + Dearness Allowance only Please enter a valid salary amount
Minimum 5 years required (except death/disability) Please enter valid years of service
6+ months count as full year

Results

Gratuity Amount: ₹0
Tax Exempt Amount: ₹0
Taxable Amount: ₹0

UAE End of Service Calculator

Most common is unlimited contract
Basic salary only (excluding allowances) Please enter a valid salary amount
Benefits increase after 5 years! Please enter valid years of service

Results

Total Gratuity: AED 0
First 5 Years (21 days/year): AED 0
After 5 Years (30 days/year): AED 0

How to Use This Calculator

  1. Step 1: Select your region (India or UAE)
  2. Step 2: Choose employment type and enter your salary details
  3. Step 3: Enter years of service and additional months (India only)
  4. Step 4: Click "Calculate" to see your gratuity amount with tax details

Gratuity Calculation Formulas

India - Payment of Gratuity Act 1972

Gratuity = (Last Drawn Salary × 15 × Years of Service) ÷ 26

Where:

Tax Exemption (India)

Under Section 10(10) of Income Tax Act, gratuity is exempt up to the least of:

For government employees, entire amount is tax-exempt.

UAE - End of Service Calculation

First 5 years: 21 days' salary per year

After 5 years: 30 days' salary per year

Daily Wage: Monthly Salary ÷ 30 days

Maximum Cap: Cannot exceed 2 years' salary

Reduction: If resignation before 5 years, benefits may be reduced

Frequently Asked Questions

Q: What is the minimum service period required for gratuity?

A: India: 5 years of continuous service is required. However, this condition is waived in case of death or disability of the employee. UAE: 1 year of continuous service is the minimum requirement for end-of-service benefits.

Q: Is gratuity taxable in India?

A: Gratuity is partially tax-exempt in India under Section 10(10) of the Income Tax Act. For government employees, the entire amount is exempt. For private sector employees, exemption is available up to ₹20 lakhs, subject to certain calculations. Any amount above the exempt limit is taxable as per applicable income tax slabs.

Q: What if I resign before 5 years in India?

A: Under the Payment of Gratuity Act 1972, you are not entitled to gratuity if you resign before completing 5 years of service. However, some organizations may have their own gratuity schemes that allow payment even before 5 years, though this is not mandatory under the law.

Q: How is gratuity calculated in UAE for limited contracts?

A: For limited contracts in UAE, the calculation is the same as unlimited contracts (21 days for first 5 years, 30 days thereafter). However, if the contract ends naturally at its expiry date, full gratuity is paid. If the employee resigns before the contract end date, the gratuity amount may be reduced.

Q: Can employer refuse to pay gratuity?

A: India: No, if you meet the eligibility criteria (5 years service, organization covered under Act), the employer is legally bound to pay gratuity. Refusal can be challenged in labor court. UAE: End-of-service gratuity is a statutory right. However, it may be forfeited if the employee is terminated for serious misconduct.

Q: What components of salary are included in gratuity calculation?

A: India: Only Basic Salary and Dearness Allowance (DA) are included. Other allowances like HRA, Conveyance, Medical, etc., are NOT included. UAE: Only the basic salary is used for calculation. Housing allowances, transport allowances, and other benefits are excluded.

Q: When should gratuity be paid after leaving the job?

A: India: Gratuity must be paid within 30 days from the date it becomes payable (i.e., from the date of resignation/retirement/termination). UAE: End-of-service gratuity should be paid within 14 days of the end of employment contract.

Q: Is there a maximum limit on gratuity amount?

A: India: There is no maximum limit on the gratuity amount that can be paid. However, the tax exemption is capped at ₹20 lakhs for private sector employees. UAE: Yes, the total end-of-service gratuity cannot exceed 2 years' basic salary.

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