Dear All,
I have been working at the company since 18/08/2006. Therefore, on 18/08/2011, my 5 years will be completed. Could you please provide me with the calculations for the gratuity amount I will receive?
My salary progression is as follows:
- Salary = 12,000, Basic 6000Rs. 2006 to 2007
- Salary = 13,500, Basic 6750Rs. 2007 to 2009
- Salary = 15,500, Basic 7750Rs. 2009 to 2010
- Salary = 17,000, Basic 8500Rs, 2010 to present now.
Thank you.
From India, Bangalore
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4I have been working at the company since 18/08/2006. Therefore, on 18/08/2011, my 5 years will be completed. Could you please provide me with the calculations for the gratuity amount I will receive?
My salary progression is as follows:
- Salary = 12,000, Basic 6000Rs. 2006 to 2007
- Salary = 13,500, Basic 6750Rs. 2007 to 2009
- Salary = 15,500, Basic 7750Rs. 2009 to 2010
- Salary = 17,000, Basic 8500Rs, 2010 to present now.
Thank you.
From India, Bangalore
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Hi, Below is the formal for calculating gratuity: Gratuity Amount= Basic of employee * 4.81% * number of years * for more information google or click the link below: Regards, Saravanan
From Sweden,
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From Sweden,
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Last month base salary
Few more information:
Gratuity is a payment made for the past services of the employee by the employer when the employee retires or resigns from the organization. This payment is also made to the employee's legal heir in the event of death. It is payable for 15 days per year for the period the employee has worked in the organization. An employee does not contribute any portion of his salary towards this amount.
Gratuity is payable to any employee only after the completion of 5 years of continuous service in the organization.
Gratuity calculation formula: This formula will help you estimate how much gratuity you will get when you retire.
Covered under the Payment of Gratuity Act, 1971: (Last drawn monthly basic salary + dearness allowance) / 26 x 15 days x number of years of service (date of joining – date of retirement/leaving job)
Note: After the completion of 5 years, if an employee works more than 6 months, it is treated as one year.
Example: If the last drawn monthly basic salary is $10,000 and the number of years served in the company is 20, then 10000 / 26 x 15 x 20 = $115384.60
Not covered under the Payment of Gratuity Act, 1971: ((Last drawn monthly basic salary + dearness allowance + commission) * 15 * No. of years of service) / 30
Here, only completed years will be considered in the calculation. If an employee has a total service of 10 years, 8 months, and 15 days, only 10 years will be considered in the calculation.
From Sweden,
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Few more information:
Gratuity is a payment made for the past services of the employee by the employer when the employee retires or resigns from the organization. This payment is also made to the employee's legal heir in the event of death. It is payable for 15 days per year for the period the employee has worked in the organization. An employee does not contribute any portion of his salary towards this amount.
Gratuity is payable to any employee only after the completion of 5 years of continuous service in the organization.
Gratuity calculation formula: This formula will help you estimate how much gratuity you will get when you retire.
Covered under the Payment of Gratuity Act, 1971: (Last drawn monthly basic salary + dearness allowance) / 26 x 15 days x number of years of service (date of joining – date of retirement/leaving job)
Note: After the completion of 5 years, if an employee works more than 6 months, it is treated as one year.
Example: If the last drawn monthly basic salary is $10,000 and the number of years served in the company is 20, then 10000 / 26 x 15 x 20 = $115384.60
Not covered under the Payment of Gratuity Act, 1971: ((Last drawn monthly basic salary + dearness allowance + commission) * 15 * No. of years of service) / 30
Here, only completed years will be considered in the calculation. If an employee has a total service of 10 years, 8 months, and 15 days, only 10 years will be considered in the calculation.
From Sweden,
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Dear Saravanan Gratuity Amount= Basic of employee * 4.81% * number of years * 10000/26 x 15 x 20 = 115384.60 what is 26,15,20 pls let me know pls let me know above confussion
From India, Bangalore
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From India, Bangalore
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Hi,
It's already explained above.
(Last drawn monthly basic salary + dearness allowance) / 26 x 15 days x number of years of service (date of joining – date of retirement/leaving job)
26 = No. of working days in a month
15 = No. of days' salary to be paid
20 = No. of years of service with the organization
Thank you.
From India, New Delhi
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It's already explained above.
(Last drawn monthly basic salary + dearness allowance) / 26 x 15 days x number of years of service (date of joining – date of retirement/leaving job)
26 = No. of working days in a month
15 = No. of days' salary to be paid
20 = No. of years of service with the organization
Thank you.
From India, New Delhi
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hi Gratuity calculation formula like, Basic + DA / 26 X 15 X ( No of total experince year ) Ex Your Gratuity = 8500/26X15X5 = 24,519 Regards Vijay Kumar Shetty 09986515380
From India, Bangalore
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From India, Bangalore
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Dear All, Under Gratuity Act, if an employee completes 6 months or more in a year it is considered to be one complete year. In the above case, it will considered 11 completed years. C B Sehgal
From India
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From India
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Hi, I am Harshal Joshi. I am working as an Executive HR in a manufacturing company in Pune. I have one query about gratuity. If my basic salary is 22000 and my total years of service are 10 years, then how do I calculate the gratuity?
Regards,
Harshal
From India, Pune
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Regards,
Harshal
From India, Pune
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As per Gratuity Act, the calculation is given below: , i.e, Rs.24519/- (TwentyFour Thousand Five Hundred Ninenteen Only) Raju, 9830681130
From India, Mumbai
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From India, Mumbai
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Hi Gratuity Formula: Last wage drawn X No.of Completed Years of Continuous service X15/26 = 8500X5X15/26 = 24519 ( Approx)
From India, Bangalore
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From India, Bangalore
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Gratuity calculation gratuity = current basic x 15 x complete year of service / 26 = 8500 x 15 x 5 /26 = 24519.00 if you left the job on 18.8.11 than you will receive rs.24519.00.
From India, New Delhi
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From India, New Delhi
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You will received half month salary of each completed year. For this salary means average salary (basic salary+dearness allowance)of last six months.
From India, Amritsar
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From India, Amritsar
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What does 4.81% mean. Based on this the calculation is not correct. Your detail answer of Last drawn basic+DA/26*15*no.of years of service is correct. Pl explain the right method
From India, Panaji
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From India, Panaji
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Your Gratuity amount will be : Last basic salary x 15/26 x 5 (yrs) in case you leave the organisation immediately after completing 5 yrs.
From India, Mumbai
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From India, Mumbai
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Gratuity is calculated based on the last basic salary drawn, which in this case is Rs. 17,000.
For each year completed, you will receive 15 days of basic salary.
One year's gratuity is calculated by dividing the basic salary by 26 days (instead of 30 days) and then multiplying the result by 15 days. In this example, (Rs. 17,000 / 26 = Rs. 654 * 15 = Rs. 9,810).
To calculate the total gratuity for a specific period of service, multiply the annual gratuity amount by the number of years in service. (Rs. 9,810 * 5 = Rs. 49,050).
Your total gratuity amount will be: Rs. 49,050/-
I hope this explanation clarifies the calculation process.
Sudhakaran
From India, Bangalore
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For each year completed, you will receive 15 days of basic salary.
One year's gratuity is calculated by dividing the basic salary by 26 days (instead of 30 days) and then multiplying the result by 15 days. In this example, (Rs. 17,000 / 26 = Rs. 654 * 15 = Rs. 9,810).
To calculate the total gratuity for a specific period of service, multiply the annual gratuity amount by the number of years in service. (Rs. 9,810 * 5 = Rs. 49,050).
Your total gratuity amount will be: Rs. 49,050/-
I hope this explanation clarifies the calculation process.
Sudhakaran
From India, Bangalore
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Then 5 years ok , if we work for 10 years , same process. Last basic salary x 15/26 x 10 (yrs) pls let me know regards riyaz.
From India, Bangalore
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From India, Bangalore
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Dear, Your calculations. Your Last Drawn Salary Is 8500. your comp.5year =Basic *Year*15days/26 =8500*5*15/26 total grauity -24519 your recieved grauity amount . thanks.
From India
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From India
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According to the Gratuity Act of 1972, the payment of gratuity is determined by a multiplier set by the Government of India. The calculation is as follows: (Basic + DA) x (15/26) x (number of years of service), with the Basic being calculated based on the last drawn salary only.
Thank you.
From India, Delhi
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Thank you.
From India, Delhi
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Explanation for 4.81%
Employers calculate their commitment of Gratuity in respect of each employee as follows:
It will be 15/26 of their salary (Basic+DA) yearly. Or it will be 15/26/12 of the monthly salary, which in percentage terms is 4.8076% (4.81% when adjusted to two decimal places). Most professionally managed companies set apart every month 4.81% of the salary of each employee to meet the liability under the Gratuity Act. Since 1987, companies have had to take compulsory insurance under Sec 4A from LIC to meet the liability. Large companies have their own approved Gratuity funds in this connection.
Some companies show 4.81% of the salary in the monthly CTC. It is important to note that the formula provided by Mr. Saravanan is not correct.
Sanu Soman
From India, Madras
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Employers calculate their commitment of Gratuity in respect of each employee as follows:
It will be 15/26 of their salary (Basic+DA) yearly. Or it will be 15/26/12 of the monthly salary, which in percentage terms is 4.8076% (4.81% when adjusted to two decimal places). Most professionally managed companies set apart every month 4.81% of the salary of each employee to meet the liability under the Gratuity Act. Since 1987, companies have had to take compulsory insurance under Sec 4A from LIC to meet the liability. Large companies have their own approved Gratuity funds in this connection.
Some companies show 4.81% of the salary in the monthly CTC. It is important to note that the formula provided by Mr. Saravanan is not correct.
Sanu Soman
From India, Madras
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Dear Riyaz,
Please note that Gratuity amount is always calculated based on the last drawn Basic and D.A.
Please find below the formula for the same:
= (Basic + DA) / 26 * 15 * Number of years in Service
In your case, your gratuity will be:
8500 / 26 * 15 * 5 = 24,519
Thank you.
From India, Alwar
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Please note that Gratuity amount is always calculated based on the last drawn Basic and D.A.
Please find below the formula for the same:
= (Basic + DA) / 26 * 15 * Number of years in Service
In your case, your gratuity will be:
8500 / 26 * 15 * 5 = 24,519
Thank you.
From India, Alwar
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Last basic salary * 15/26 * 5 Last basic salary/26*15*5 Which is the correct formula to calculate gratuity, pls let me know , Some people said first one , some second regards riyaz.
From India, Bangalore
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From India, Bangalore
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Saravanan, I did not understand the formula of Last Basic*4.81%*No of years of service. Pl present an example of calculation with the above formula for an easy understanding.
From India, Panaji
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From India, Panaji
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Hi,
The formula for calculating the gratuity amount is as follows:
[ W times Y times 15/26 ]
Where:
- W = Last wage drawn (i.e., basic + DA)
- Y = Number of completed years of continuous service (ignoring six months or less, and counting more than six months as a full year)
- 15 = 15 days' salary
- 26 = Number of working days in a month
Therefore, in your case, the gratuity amount would be:
[ 8500 times 5 times 15/26 = 24519.23 INR ] only.
Regards,
Dharmendra
HR Adroit
From India, Delhi
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The formula for calculating the gratuity amount is as follows:
[ W times Y times 15/26 ]
Where:
- W = Last wage drawn (i.e., basic + DA)
- Y = Number of completed years of continuous service (ignoring six months or less, and counting more than six months as a full year)
- 15 = 15 days' salary
- 26 = Number of working days in a month
Therefore, in your case, the gratuity amount would be:
[ 8500 times 5 times 15/26 = 24519.23 INR ] only.
Regards,
Dharmendra
HR Adroit
From India, Delhi
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your current basic salary = 8500 No of years of service with the organisation = 5 yr Gratuity Amount = 8500/26*15*5 = 24519/-
From India, Bangalore
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From India, Bangalore
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Last Drawn salary (Basic) 8500 / 26 days your per day salary 326.9230769 x 15 days 15days salary per year 4903.846154 x 5 no of years complited in the services your Gratuity 24519.23077
From India, Pune
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From India, Pune
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Last Drawn salary (Basic) 8500 / 26 days your per day salary 326.92 x 15 days 15days salary per year 4903.84 x 5 no of yrs complited your Gratuity Amt. 24519.23 Thanks Bharat Sakpale 9763335696
From India, Pune
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From India, Pune
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Hi, thanks for sharing the valuable information regarding gratuity. I am very new to this, so could you kindly explain to me why the 15-day salary needs to be multiplied with the formula? What I mean to ask is, does the number of days vary?
From India, Bangalore
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From India, Bangalore
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hi current basic is 8500/- so your gratuity is calculated to your current basic. formula for gratuity = Basic/26*15* number of years 8500/26*15*5=24519
From India, Pune
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From India, Pune
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Hi Seniors, Is it suitable for any private concern! Pls tell me, B.coz i am working as a accounts manager in a private concern. Regards, Venkat
From India, Pondicherry
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From India, Pondicherry
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vasavi, upto 10 L it is I.T.exempted. Companies can pay more also, no ceiling for pvt companies but 10L is the limit for Govt employees. Pon
From India, Lucknow
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From India, Lucknow
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Dear Riyazbasha,
Both calculations will give you the same result. However, the second one will provide more clarity regarding the logic to be used. This is the perfect calculation, and you can continue calculating based on the number of years (service) completed by the person.
Sudhakaran
From India, Bangalore
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Both calculations will give you the same result. However, the second one will provide more clarity regarding the logic to be used. This is the perfect calculation, and you can continue calculating based on the number of years (service) completed by the person.
Sudhakaran
From India, Bangalore
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SALARY SHEET CALCULATION.xls
Salary calculation.doc