Gratuity Calculator for Central Government Employees after 7th Pay Commission
Death, Retirement, and Service Gratuity for Central Government Employees
What is Gratuity in Central Government Services?
- Gratuity is a hidden savings of employees working in Government Service. The gratuity amount is calculated depends upon his period of service. The bulk amount of Gratuity is usually paid at the time of retirement. In some cases, it can be paid before as per existing rules.
How to calculate Gratuity?
Gratuity Calculation for Central Government Employees.
- Calculation of Gratuity = [ (Basic Pay + Dearness Allowance) x 15 days x Number of Years of Service ] / 26 Days.
Is Gratuity Taxable for CG Employees?
- According to the existing gratuity rules and act the amount of gratuity received is fully exempt from income tax. The maximum ceiling is now Rs. 20 lakh after the 7th pay commission.
Why calculating taken 26 Days instead of 31?
- As per the labour law in India, the maximum working days in a month should be 26. A weekly holiday should be given to employees is compulsory.
What is the ceiling of Gratuity?
- The 7th pay commission recommended to enhance the ceiling of Gratuity from Rs. 10 lakh to 20 lakh.
There are three types of Gratuity in force in Government services…
Retirement Gratuity, Death Gratuity and Service Gratuity
Retirement Gratuity: This is payable to the retiring Government servant. A minimum of 5 years’ qualifying service and eligibility to receive service gratuity/pension is essential to get this one-time lump sum benefit. Retirement gratuity is calculated @ 1/4th of a month Basic Pay plus Dearness Allowance is drawn on the date of retirement for each completed six monthly periods of qualifying service. There is no minimum limit for the amount of gratuity. The retirement gratuity payable for qualifying service of 33 years or more is 16 times the Basic Pay plus DA, subject to a maximum of Rs. 20 lakhs.
Death Gratuity: This is a one-time lump sum benefit payable to the nominee or family member of a Government servant dying in harness. There is no stipulation in regard to any minimum length of service rendered by the deceased employee. Entitlement of death gratuity is regulated as under:
|Less than one year||2 times of basic pay|
|One year or more but less than 5 years||6 times of basic pay|
|5 years or more but less than 11 years||12 times of basic pay|
|11 years or more but less than 20 years||20 times of basic pay|
|20 years or more||Half of the emoluments for every completed 6 monthly periods of qualifying service subject to a maximum of 33 times of emoluments.|
The maximum amount of Death Gratuity admissible is Rs. 20 lakhs w.e.f. 1.1.2016
Service Gratuity: A retiring Government servant will be entitled to receive service gratuity (and not pension) if the total qualifying service is less than 10 years. The admissible amount is half a months basic pay last drawn plus DA for each completed 6 monthly periods of qualifying service. This one-time lump sum payment is distinct from retirement gratuity and is paid over and above the retirement gratuity.
Latest Updates on Gratuity for CG Employees:
- Loss of Gratuity and Leave Salary Due to Freezing of Dearness Allowance October 10, 2020
- Release Gratuity to retired employees of BSNL without any delay July 11, 2020
- Benefit of Gratuity to CG Employees Covered under National Pension System (NPS) February 17, 2020
- Gratuity – Calculation, Ceiling, Qualifying Service and Rates September 17, 2019
- Revision of Gratuity and Severance Amount to GDS July 24, 2019
- 7th Pay Commission Committee recommendations on Gratuity July 23, 2019
- Stoppage of Retirement and Death Gratuity to the NPS Subscribers May 28, 2019
- IT Exemption for Gratuity upto 20 Lakhs – Gazette Notification March 15, 2019
- IT Exemption on Gratuity – 20 lakhs w.e.f. 29.3.2018 March 12, 2019
- Brief on Payment of Gratuity (Amendment) Act, 2018 May 31, 2018
- Gazette Notification on Gratuity: Amount, Effective Date and Maternity Leave March 30, 2018
- Gratuity ceiling raised to 20 Lakhs w.e.f. 29.3.2018 March 30, 2018
- Upper Ceiling on Gratuity 20 Lakhs March 24, 2018
- UFBU writes to Finance Minister regarding Gratuity Ceiling December 11, 2017
- Non-Payment of Gratuity and Pay Revision Arrears by HEC March 15, 2017
- Retirement Gratuity Ceiling hiked to Rs.20 lakh for bank employees and officers March 7, 2017
- Rationalisation of Death Gratuity by 7th Pay Commission December 12, 2015
- 7th CPC increased Gratuity Ceiling limit – 20 lakh from 1.1.2016 December 12, 2015