Gratuity Calculator: Rs 35,000 as last-drawn basic salary, 6 years and 3 months of service; find out your gratuity amount

Let’s find out what will be your gratuity amount with Rs 35,000 as the last-drawn salary in the service period of 6 years, and 3 months. Understand it through the calculations.

Anamika Singh | Jan 22, 2025, 01:25 PM IST

Gratuity is a bonus given to employees for their long service. To be eligible, you need to work for 5 years of uninterrupted service. The amount is paid when you leave or retire, based on how long you worked. For example, let's calculate the gratuity for an employee who last earned a basic salary of Rs 35,000 and worked for 6 years and 3 months.

Photos source: Pixabay/Representational

(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)

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What is gratuity?

What is gratuity?

Gratuity is a one-time payment made by an employer to thank employees for their long service. To get it, you need to work for at least 5 years. The Payment of Gratuity Act, of 1972, guides this payment. If an eligible employee passes away, their family member receives the gratuity.

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Length of service

Length of service

The employees must have completed continuous 5 years of service. This includes service that is uninterrupted by leave, accident, sickness, lockout, strike, layoff, or absence from duty without leave.

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What are the eligibility criteria for gratuity?

What are the eligibility criteria for gratuity?

To be eligible for gratuity, employees must have uninterrupted 5 years of service in an organisation. 
The organisation must come under the Payment of Gratuity Act, of 1972.

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Other conditions in which one can get gratuity?

Other conditions in which one can get gratuity?

Gratuity is payable not only at the time of retirement but also in various situations. Such as:
Superannuation
Termination
Resignation
Death or disablement

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Organisational criteria for gratuity

Organisational criteria for gratuity

Organisations employing 10 or more individuals over the past years and following the Payment of Gratuity Act, of 1972, are required to pay gratuity. 

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How service years are counted

How service years are counted

One needs to complete at least 5 years of uninterrupted to get gratuity. But after, if someone has completed 6 months of service, it will be counted as a full year. 

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What are the factors that determine the gratuity amount?

What are the factors that determine the gratuity amount?

The number of years and the last-drawn basic salary of an employee can be used to calculate the gratuity amount.

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Can a company opt out of the Payment of Gratuity Act?

Can a company opt out of the Payment of Gratuity Act?

If a company falls under the Payment of Gratuity Act, of 1972, it cannot count itself out. 

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Formula to calculate gratuity

Formula to calculate gratuity

(Last Drawn Salary x Number of Years of Service) X 15/26
Here 15 refers to 15 days’ wages per year, and 26 refers to 30 days in a month excluding Sundays.

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Gratuity calculation for Rs 35,000 as last-drawn salary and 6 years and 3 months of service

Gratuity calculation for Rs 35,000 as last-drawn salary and 6 years and 3 months of service

The estimated gratuity amount of the individual will be Rs 1,21,153.

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