Gratuity exemption limit

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Querist : Anonymous

Querist : Anonymous (Querist)

19 July 2013 I read that the exemption limit for gratuity received is Rs.10 Lacs.I this exemption applicable to all the kind of employees or only those employed in a public sector.Please give your opinion

Rupesh Jain

Rupesh Jain (Expert)
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19 July 2013 1) 1/2 month salary for each complete year
2) 10,00,000/-
3) actually received amount

whichever is less is exempted under incometax

Aashish Tiwari

Aashish Tiwari (Expert)
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19 July 2013 As per act, gratuity received by government employee is fully exempt irrespective of any limit. This limit is for employee covered under gratuity act..
It is very important to understand the definition of employee under the Act. Employee means any person (other than an apprentice) employed on wages to do any skilled, semi- skilled, or unskilled, manual, supervisory, technical or clerical work, whether the terms of such employment are express or implied and whether or not such person is employed in a managerial or administrative capacity. However it does not include any such person who holds a post under the Central Government or a State Government and is governed byany other Act or by any rules providing for payment of gratuity.
Regards

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