Status as of 17 October 2026
Retirement gratuity = ¼ of (basic pay + DA) for each completed six-monthly period of qualifying service, up to 66 periods (16½ times emoluments). Confirmed
The maximum gratuity is ₹25 lakh from 1 January 2024 (DoPPW OM of 30 May 2024), for both the old pension scheme and NPS/UPS. Confirmed
Leave encashment = (basic pay + DA) ÷ 30 × days of earned leave, plus half pay leave at half pay plus DA, up to 300 days in all (Rule 39, CCS (Leave) Rules). Confirmed
DA is 60% from 1 January 2026; change it in the calculator if it changes. Confirmed
Last verified: 17 October 2026
Work out your retirement gratuity, the death gratuity payable to your family, and your leave encashment on retirement under the rules for Central Government civilian employees. Use the tabs to switch between gratuity and leave encashment. The other retirement figures are in the pension calculator and the commutation of pension calculator, and the retirement date calculator tells you your last working day.
Gratuity and leave encashment calculator
How retirement and death gratuity are calculated
- Emoluments are the basic pay last drawn (plus non-practising allowance for doctors) and the DA admissible on the date of retirement or death. If pay was reduced in the last ten months, average emoluments are used. Confirmed
- Six-monthly periods: count completed half-years of qualifying service. A fraction of a year of three months or more counts as a completed six-monthly period, so 30 years 4 months gives 61 periods and 30 years 9 months gives 62. Service of 4 years 9 months counts as 5 years. Confirmed
- Retirement gratuity needs at least five years of qualifying service: ¼ of emoluments × six-monthly periods, at most 66 periods (33 years), so the most is 16½ times emoluments. Confirmed
- Limit: ₹20 lakh from 1 January 2016, raised to ₹25 lakh from 1 January 2024 once DA reached 50%. A fraction of a rupee is rounded up. Confirmed
- Notional increment for those retiring on 30 June or 31 December counts for pension only, not for gratuity (DoPT OM of 20 May 2025). Confirmed
Death gratuity rates
| Qualifying service | Death gratuity |
|---|---|
| Less than 1 year | 2 times emoluments |
| 1 year or more but less than 5 years | 6 times emoluments |
| 5 years or more but less than 11 years | 12 times emoluments |
| 11 years or more but less than 20 years | 20 times emoluments |
| 20 years or more | Half of emoluments for each completed six-monthly period, up to 33 times emoluments |
Rule 45(1)(b), CCS (Pension) Rules, 2021, and rule 22(2), CCS (Payment of Gratuity under NPS) Rules, 2021. The same ₹25 lakh limit applies. Confirmed The calculator applies the three-month rounding when it picks the slab, so 4 years 9 months falls in the 5-to-11-year slab. Our reading
NPS and UPS employees get retirement and death gratuity under the CCS (Payment of Gratuity under NPS) Rules, 2021, with the same formula, rates and limit. Under UPS, the lump sum paid on superannuation is a separate benefit and is not included here. Confirmed
Gratuity worked examples
| Case | Working | Gratuity |
|---|---|---|
| Retirement: basic ₹78,800, DA 60%, 30 years 4 months | ₹78,800 + ₹47,280 = ₹1,26,080; 61 periods; ₹1,26,080 × 61 ÷ 4 | ₹19,22,720 |
| Retirement with 33-year limit: basic ₹56,900, DA 60%, 36 years 7 months | ₹91,040 × 66 ÷ 4 (73 periods, only 66 count) | ₹15,02,160 |
| Retirement above the limit: basic ₹1,82,200, DA 60%, 34 years | ₹2,91,520 × 16.5 = ₹48,10,080, limited to ₹25 lakh | ₹25,00,000 |
| Retirement after 4 years 9 months: basic ₹35,400, DA 60% | Counts as 5 years (10 periods): ₹56,640 × 10 ÷ 4 | ₹1,41,600 |
| Death in service after 15 years: basic ₹59,500, DA 60% | ₹95,200 × 20 | ₹19,04,000 |
| Death in service after 4 years 9 months: basic ₹44,900, DA 60% | Counts as 5 years: ₹71,840 × 12 | ₹8,62,080 |
How leave encashment is calculated
- Earned leave: (pay on the date of retirement + DA on that date) ÷ 30 × days of earned leave at credit. Confirmed
- Half pay leave: (half pay leave salary + DA on it) ÷ 30 × days of half pay leave at credit. Half pay leave salary is half the pay. No pension is deducted. Confirmed
- 300-day limit: earned leave and half pay leave together cannot exceed 300 days, and half pay leave cannot be commuted to make up a shortfall in earned leave. The calculator counts earned leave first because it pays more per day. Confirmed
- The same formula applies on death in service (rule 39-A, paid to the family), on invalidation (rule 39-B) and on voluntary or notice retirement (rule 39(5)). Confirmed
- On resignation, only half of the earned leave at credit can be encashed, up to 150 days (rule 39(6)(a)(ii)). Confirmed
Leave encashment worked examples
| Case | Working | Amount |
|---|---|---|
| 300 days earned leave: basic ₹78,800, DA 60% | ₹1,26,080 ÷ 30 × 300 | ₹12,60,800 |
| 240 days earned leave + 100 days half pay leave, same pay | 240 × ₹4,202.67 = ₹10,08,640; only 60 half pay days fit: 60 × (₹39,400 + ₹23,640) ÷ 30 = ₹1,26,080 | ₹11,34,720 |
| Resignation with 250 days earned leave, same pay | Half = 125 days: ₹1,26,080 ÷ 30 × 125 | ₹5,25,333 |
Amounts are rounded to the nearest rupee; the rules do not prescribe rounding, so your PAO’s figure may differ by a rupee. Estimate
Income tax on gratuity and leave encashment
From 1 April 2026 the Income-tax Act, 2025 applies. Its section 19 allows a deduction from salary for the entire death-cum-retirement gratuity received under the CCS (Pension) Rules, 2021 or a similar scheme for civil servants of the Union (Table Sl. No. 3), and for the entire cash equivalent of earned leave received by a Central or State Government employee on retirement, whether on superannuation or otherwise (Sl. No. 13). These replace the old exemptions in sections 10(10)(i) and 10(10AA)(i) of the Income-tax Act, 1961. Confirmed
Our reading: NPS gratuity is a “similar scheme” for civil servants of the Union, and Sl. No. 13 speaks of earned leave, so check the half pay leave part and any resignation encashment with your tax adviser. Our reading
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Before retirement, check your nomination for gratuity and the pension Form 5.
Gratuity and leave encashment: FAQs
How is gratuity calculated for Central Government employees?
Retirement gratuity is one-fourth of emoluments (basic pay plus DA) for each completed six-monthly period of qualifying service, up to 66 periods, so at most 16.5 times emoluments, subject to ₹25 lakh. With basic pay ₹78,800, DA 60% and 30 years 4 months of service it comes to ₹19,22,720.
What is the maximum gratuity for Central Government employees in 2026?
The limit is ₹25 lakh for retirements and deaths on or after 1 January 2024 (DoPPW OM of 30 May 2024), up from ₹20 lakh. It applies under both the CCS (Pension) Rules, 2021 and the CCS (Payment of Gratuity under NPS) Rules, 2021.
How much death gratuity is paid if an employee dies in service?
Two times emoluments for less than 1 year of service, 6 times for 1 to under 5 years, 12 times for 5 to under 11 years, 20 times for 11 to under 20 years, and half of emoluments for each completed six-monthly period for 20 years or more, up to 33 times emoluments and ₹25 lakh.
Do NPS and UPS employees get gratuity?
Yes. Retirement and death gratuity are paid under the CCS (Payment of Gratuity under NPS) Rules, 2021 on the same formula and with the same ₹25 lakh limit. The UPS lump sum on superannuation is a separate payment.
How is leave encashment calculated on retirement?
Earned leave is paid at (pay plus DA on the last day) ÷ 30 per day, and half pay leave at (half pay plus DA on it) ÷ 30 per day. Earned leave and half pay leave together are limited to 300 days. On resignation only half the earned leave, up to 150 days, is encashed.
Is the notional increment for 30 June or 31 December retirees counted for gratuity?
No. DoPT’s OM of 20 May 2025 says the notional increment on 1 July or 1 January counts only for calculating pension, not for other pensionary benefits such as gratuity.
Is gratuity or leave encashment taxable for Central Government employees?
Under section 19 of the Income-tax Act, 2025, the entire death-cum-retirement gratuity under the CCS (Pension) Rules, 2021 and the entire earned leave encashment of a Government employee on retirement are deductible from salary, as under the old sections 10(10)(i) and 10(10AA)(i).
Source & accuracy
Last verified: 17 October 2026
Official sources:
- CCS (Pension) Rules, 2021 (G.S.R. 868(E), 20 Dec 2021): rule 45 retirement and death gratuity
- DoPPW OM No. 28/91/2022-P&PW(B)/8331, 11 Oct 2022: grant of retirement and death gratuity (DA counts as emoluments; 3-month rounding)
- DoPPW OM No. 28/03/2024-P&PW(B)/Gratuity/9559, 30 May 2024: gratuity limit ₹25 lakh from 1.1.2024
- PIB, 1 Jun 2024: ₹25 lakh limit applies under the CCS (Pension) Rules, 2021 and the CCS (Payment of Gratuity under NPS) Rules, 2021
- CCS (Leave) Rules, 1972 (DoPT, updated 24 Sep 2024): rules 39, 39-A, 39-B and 40
- DoPT OM No. 19/116/2024-Pers.Pol.(Pay)(Pt), 20 May 2025: notional increment for 30 June / 31 December retirees, for pension only
- Income-tax Act, 2025, section 19 (Income Tax Department): Table Sl. No. 3 and 13
- DoE OM No. 1/1(i)/2026-E.II(B), 22 Apr 2026: DA 60% from 1.1.2026
The text of the CCS (Payment of Gratuity under NPS) Rules, 2021, rule 22, was read in a reproduction; the PIB release and the DoPPW OM of 30 May 2024 confirm the rules and the limit. The DoPT notional increment OM of 20 May 2025 was read in a reproduction because the PDF on the DoPT site could not be opened as text.
Labels: Confirmed official source linked · Estimate our calculation, not an official figure · Our reading our interpretation where the rule is silent
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