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How gratuity is calculated with example?
The formula is: (15 * Your last drawn salary * the working tenure) / 30. For example, you have a basic salary of Rs 30,000. You have rendered continuous service of 7 years and the employer is not covered under the Gratuity Act. Gratuity Amount = (15 * 30,000 * 7) / 30 = Rs 1,05,000.
How do you calculate total gratuity?
Formula to calculate gratuity yourself- The formula is 15 X (last drawn salary) X (tenure of working)/26. For instance, employee X’s last drawn salary is 50,000 per month and has worked with ABC ltd company for about 30 years. So, his gratuity will be calculated as: (15 X 50,000 X 30)/26= Rs 9,37,500.
What is gratuity amount?
Gratuity is the monetary amount which is payable to the employee of an organisation under the Payment of Gratuity Act 1972. It is generally a token amount paid by the company showing gratitude towards the employee for their services towards the organisation.
What is the meaning of 15 26 in gratuity calculation?
The ratio 15 / 26 represents 15 days out of 26 working days in a month i.e., An average of 30 days reduced by 4 Sundays is considered for calculation. Last drawn salary = Basic Salary + Dearness Allowance i.e., Basic + DA.
What is gratuity in salary slip?
How is gratuity calculated monthly?
Calculation of Gratuity Total Gratuity Payable = (Last Drawn Monthly Salary) x (15/26) x (Number of years of service completed). For example, if you joined service in 2013 and resigned in 2018 with a monthly salary of Rs. 50,000 (in 2015), your gratuity will be calculated as follows: – (15/26* Rs. 50,000)*5 = Rs.
How do I calculate my last 10 months salary?
Note – *Average salary = Average Salary of last 10 months immediately preceding the month of retirement. Salary = Basic Pay + DA (to the extent it forms part of retirement benefits) + turnover based commission.