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Guide

Gratuity Rules & Calculation

Eligibility, formula and the ₹20 lakh tax exemption.

Updated 17 August 2026

Your numbers

₹5,000₹80,000₹50 L
012 years45
Gratuity payable
₹5,53,846
Eligible
Yes
Tax-free portion
₹5,53,846
Taxable portion
₹0

What this means.The formula is (last basic × 15 × years of service) ÷ 26. Service over six months counts as a full year. The lifetime tax-free limit of ₹20 lakh applies across all employers, not per job.

Questions

Is this investing information specific to India?

Yes. Everything on Credsir is written for Indian regulation, Indian tax law and Indian products — RBI rules, IRDAI norms, SEBI regulation and the current financial year’s income tax provisions.

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Advertised rates are the best case, reserved for applicants with a high credit score, stable income and a favourable profile. Your offer depends on your credit score, employer, income and existing obligations. Treat published rates as the floor, not the quote.

Related reading

Worth knowing.Rates, fees and terms change frequently and vary by applicant. Everything here is general information, not personalised advice. Confirm the current terms directly with the institution before you apply. How we research and rate.