Yes, gratuity can be a part of the CTC. Most companies show gratuity as part of the CTC in offer letters. But remember that, even though gratuity shows in your offer letter/appointment letter, you will not get that amount every month in your salary.
Gratuity is a retirement benefit, and it will be paid to the employee only if he/she completes 5 years of service in the same company. Otherwise, the gratuity amount remains in the company’s gratuity fund.
However, some companies, if they have a specific policy, will pay the gratuity even before 5 years if they show gratuity in CTC. But such companies are very rare.
You should take confirmation at the time of joining the company. You can ask about this to the HR.
How Much Gratuity Can Be Shown in CTC
4.81% of your basic salary (along with dearness allowances, if any) will be the gratuity amount.
Suppose your monthly basic salary is ₹20,000; then 4.81% is ₹962 per month and ₹11,544 per year.
| Particular | Amount |
|---|---|
| Monthly Basic Salary | ₹20,000 |
| Gratuity Rate | 4.81% |
| Gratuity per Month | ₹962 |
| Gratuity per Year | ₹11,544 |
Every month, that amount will be kept in the gratuity fund of the company. After 5 years, you will get that amount if you leave the job as part of the full and Final Settlement.
Is Gratuity Deducted from Monthly Salary
No, gratuity should not be deducted from the monthly salary. It is a cost to the company. If any company is deducting gratuity from the employee’s salary, it is against the Payment of Gratuity Act, 1972.
Any company that has 10 or more than 10 employees should pay gratuity to their employees if they complete 5 years of service.
So, if you are an employer, keep a separate account for the gratuity fund.
In order to avail gratuity, employees should fill out gratuity form F (nomination form) at the time of joining.
To claim the gratuity amount after leaving the job, submit gratuity form I.