Hi all, If the Gratuity is a factor in the CTC for an IT firm, can a employee get back the amount deducted without completion of his 5 yrs service with the organization. Regards Visha
From India, Delhi
From India, Delhi
hello visha,
The graduity is payable before the 5 yrs of compltion with any organisation only if an employee dies or gets permenently disable than he or his family will get the amoung of gratuity.
And there is one more thing too, there are some companies operating on CTC basis means the gratuity is a part of their salary package itself in such cases the amt is payable at the time of resignation also.
Anal Shah
From India, Ahmadabad
9The graduity is payable before the 5 yrs of compltion with any organisation only if an employee dies or gets permenently disable than he or his family will get the amoung of gratuity.
And there is one more thing too, there are some companies operating on CTC basis means the gratuity is a part of their salary package itself in such cases the amt is payable at the time of resignation also.
Anal Shah
From India, Ahmadabad
Gratuity is paid on account of five years' continuous service (or less if service is interrupted by death). Gratuity paid upto and including Rs. 3.5 lakhs is tax free and gratuity paid beyond such figure attracts tax.
Gratuity paid for service under five continous years, if allowable by company policy, can be paid, but the whole amount would attract tax and no portion would be taxfree.
Correct me if I am wrong.
Jeroo
From India, Mumbai
Gratuity paid for service under five continous years, if allowable by company policy, can be paid, but the whole amount would attract tax and no portion would be taxfree.
Correct me if I am wrong.
Jeroo
From India, Mumbai
Hi Visha,
I fully agree with the comments by Jeroo Chandiok.
However i feel that your query was not answered
The answer is no.
The reason being the good intent of the employer wherein the deducted amount is contributed to Gratuity fund as maintained by the Company through the Insurance companies like LIC etc.
There has been a debate here in this column on this subject; would recommend to use the search tool on the top left.
Regards,
Rajat
From India, Pune
I fully agree with the comments by Jeroo Chandiok.
However i feel that your query was not answered
The answer is no.
The reason being the good intent of the employer wherein the deducted amount is contributed to Gratuity fund as maintained by the Company through the Insurance companies like LIC etc.
There has been a debate here in this column on this subject; would recommend to use the search tool on the top left.
Regards,
Rajat
From India, Pune
Yes Rajat is right.
Once after posting my comment here i got to know by discussing this with some seniors in HR that
Graduity amt is taken care by the central govt. (LIC sort of companies) for the better investments but there are no companies.
the formula for calculating the graduity is (last drawn basic/26)*15
and the maximum limit is 3,50,000/- as said by rajat.
But paying something more than the law is not an offense so comapnies do pay higher than that also.
Thanks to Rajat.
Regards,
From India, Ahmadabad
Once after posting my comment here i got to know by discussing this with some seniors in HR that
Graduity amt is taken care by the central govt. (LIC sort of companies) for the better investments but there are no companies.
the formula for calculating the graduity is (last drawn basic/26)*15
and the maximum limit is 3,50,000/- as said by rajat.
But paying something more than the law is not an offense so comapnies do pay higher than that also.
Thanks to Rajat.
Regards,
From India, Ahmadabad
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Payment of Gratuity Act, 1972 & The Rules.ppt
THE PAYMENT OF GRATUITY ACT 1972.doc