Tax calculation for gratuity of lic agent

Gratuity calculation:

Minimum of the following:

1) Actual gratuity received

2) 15 days salary of completed years 

3) Rs. 10 lacs

Note:

Salary includes salary + dearness allowance. 

Number of days per month is 26.

For example:

Salary - Rs. 200,000/- pa

Number of years service - 12 years

Gratuity shall be 13,84,615/- (200,000 x 15/26 x 12)

Gratuity paid can be sometimes more than the gratuity calculations.