Gratuity under the labour codes
Compare gratuity on the basic pay your employer shows with gratuity on the wage base under the labour codes’ 50% rule, in force from 21 November 2025. Arithmetic on the pay and service you enter.
How it works
Wage base = the higher of basic + DA and 50% of total monthly pay. Gratuity = wage base × 15 × years counted ÷ 26. More than six months beyond full years counts as another year.
Assumptions
- Under the labour codes, wages are reported as basic pay plus dearness allowance, and where these are less than 50% of total pay the shortfall is added back to the wage base. In force from 21 November 2025 as reported. The codes have not been checked here; read them.
- Gratuity is 15 days of wages for each year of service on a 26-day month, to a ceiling of ₹20 lakh. Five years of service for permanent staff and one year for fixed-term staff, as reported.
- Service before 21 November 2025 may fall under the Payment of Gratuity Act, 1972. This tool applies the 50% rule to the whole service as an illustration and does not split it.
- Death or disability, which can waive the service condition, state rules, notified rates and taxation of the amount are not modelled. Any PF or take-home pay effect of the 50% rule is also not modelled.
More tools
EMI calculator
Monthly instalment, total interest and the year-by-year split for a reducing-balance loan.
CAGR calculator
The single yearly growth rate that links a starting value to an ending value.
SIP calculator
What regular monthly investments would add up to at a rate you choose. Illustrative only.
Compound interest calculator
How a single amount grows when each year’s growth is added to the base.
Inflation calculator
What an amount would cost later, and what it would buy later, at an inflation rate you choose.
YoY and QoQ growth calculator
Percentage change between two figures, the way results statements show growth.
EPF wage ceiling calculator
PF contribution on the old Rs 15,000 and the new Rs 25,000 wage ceiling, side by side.
Share buyback tax calculator
Tax on a share buyback as capital gains from 1 April 2026, against the earlier dividend-style rule.
Mutual fund expense calculator
Add up a scheme’s base expense ratio, brokerage and levies, and see what they cost in rupees over the years.
Sovereign Gold Bond exit tax checker
Which tax rule applies to a Sovereign Gold Bond exit from 1 April 2026, and the arithmetic if the gain is taxable.
These tools do arithmetic on the numbers you enter. They are for illustration and education. They do not predict returns, and they are not investment, tax or financial advice. Returns are not guaranteed.