Gratuity
This query is : Resolved
Ashiwini Ballodia
(Querist)
15 June 2018
If a employee has worked in a organization for 4 years 8 months and he has received gratuity.
Whether the employee is eligible for any exemption as per Income Tax.
Whether the employee is eligible for any exemption as per Income Tax.
KAVIRAJA ADDANGADI
(Expert)
16 June 2018
If Gratuity is worked in according to second 10(10) you can claim exempt.
In case of gratuity received by any employee whose employer is covered under the Gratuity Act, the following amount is exempt from tax.
15 days salary as per the last drawn salary of the individual
In case of gratuity received by any employee whose employer is covered under the Gratuity Act, the following amount is exempt from tax.
15 days salary as per the last drawn salary of the individual
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Ashiwini Ballodia
(Expert)
16 June 2018
Thanks sir for the response.
Employer is covered under Gratuity Act but here employee has not completed 5 years.
Employer has given gratuity to the employee as competition because the company has discontinued one bussiness unit and said all the employee to left the company.
Employer is covered under Gratuity Act but here employee has not completed 5 years.
Employer has given gratuity to the employee as competition because the company has discontinued one bussiness unit and said all the employee to left the company.
KAVIRAJA ADDANGADI
(Expert)
16 June 2018
Gratuity not necessary to complete 5 years
If Employee
1.he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under the Industrial Disputes Act, 1947 (14 of 1947), or under any other law applicable to the establishment; he has been on leave with full wages, earned in the previous year; he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed twelve weeks].
(2) Where an employee, employed in a seasonal establishment, is not in continuous service within the meaning of clause
(1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer for such period if he has actually worked for not less than seventy-five per cent of the number of days on which the establishment was in operation during such period.]
Employer can cover optionally Gratuity less than 5 years but once 5 years it is mandatory to pay Gratuity.
If Employee
1.he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under the Industrial Disputes Act, 1947 (14 of 1947), or under any other law applicable to the establishment; he has been on leave with full wages, earned in the previous year; he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and in the case of a female, she has been on maternity leave; so, however, that the total period of such maternity leave does not exceed twelve weeks].
(2) Where an employee, employed in a seasonal establishment, is not in continuous service within the meaning of clause
(1), for any period of one year or six months, he shall be deemed to be in continuous service under the employer for such period if he has actually worked for not less than seventy-five per cent of the number of days on which the establishment was in operation during such period.]
Employer can cover optionally Gratuity less than 5 years but once 5 years it is mandatory to pay Gratuity.
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