Gratuity calculator
Under section 53 of the Labour Act 2074 your employer deposits 8.33% of your basic remuneration every month, from the day you start. There is no three-year qualifying period any more — that went with the old Act.
Your service
Rs 1,49,940after 5 years · about 5.0 months of basic salary
The entitlement
| Deposited each month | Rs 2,499 |
|---|---|
| Months of service | 60 |
| Total accrued | Rs 1,49,940 |
| In months of basic | 5.00 |
| If basic had never changed | — |
| Overstated by | — |
Where it is held
The Social Security Fund, in the labour’s own name, from the date they begin work.
Because your employer is SSF-registered, this amount is inside their 20% contribution, not a separate cheque at the end. Check it against your SSF statement rather than expecting it from payroll.
Service before 4 Bhadra 2074 is not computed here. Computed under the Labour Act 2048, which used a slab of months’ salary per year of service rather than a monthly percentage. This page does not compute it. The 2048 slabs could not be checked against a primary text, and an employee with pre-2017 service is exactly the one for whom a guessed figure is worth the most money. Ask your employer, or the SSF, for the transferred balance for that period. Section 53(3) required it to be moved into the Fund.
Gratuity is taxable. A payment out of an approved retirement fund is charged on the gain rather than on the whole amount, and the rate depends on the fund's approval status. This page gives the entitlement before tax; the deduction is worked out when it is paid.
A year of service is almost exactly one month's basic
8.33% twelve times over is 99.96% — so every year you work earns you 0.9996 of a month's basic salary. That is the sentence worth remembering. Five years is five months' basic, ten years is ten, and the 0.04% shortfall is the rounding the Act itself chose when it wrote 8.33 instead of one twelfth.
It accrues on the basic of the month, not your final salary
This is where most gratuity estimates go wrong. The deposit is 8.33% of what you were earningthat month. Someone who joined on Rs 18,000 and now earns Rs 30,000 has not been accruing at Rs 30,000 for the whole period, and multiplying their current basic by their whole service overstates the entitlement — by a fifth, on that example.
Filling in the starting-basic box walks a straight line between the two figures month by month. A real salary history is a staircase rather than a ramp, so it is an estimate and the page labels it one, but it is much closer than either end used alone.
The three-year rule is gone
Under the Labour Act 2048 an employee needed three years of continuous service before any gratuity was payable, and people still repeat it. Section 53 replaced the qualifying period with a monthly deposit: the employer deposits from the day you begin work, so an employee who leaves after seven months has seven months of gratuity sitting in the Fund in their name.
If your employer is in the SSF, there is only one payment
The employer's 20% Social Security Fund contribution is the vehicle for gratuity, provident fund, medical cover and pension together. There is no separate gratuity cheque on top of it. Expecting both is the commonest wrong expectation in this area, and it usually surfaces on the last day of employment when it is hardest to resolve.
The SSF calculator breaks that 20% into its four schemes, and the salary tax calculator handles the retirement-contribution deduction against income tax.
Common questions
- Is this Nepal gratuity calculator page free to use?
- Yes. Every Kaamko tool is free, with no sign-up, no account and no usage limit. They are published by Imperial College of Engineering, a Tribhuvan University-affiliated engineering college in Tathali, Bhaktapur, and are not funded by advertising.
- Does what I type get sent anywhere?
- No. This tool runs entirely in your browser: the calculation happens on your own device, nothing you type is uploaded, and nothing is stored after you close the page.
- Where do the figures come from?
- Each tool names its source on the page, along with the date that source was read. Where a rate or a slab is provisional — announced in a budget speech but not yet gazetted, for instance — the page says so rather than presenting it as settled.
- Who maintains these tools?
- Imperial College of Engineering, formerly Janakpur Engineering College, in Tathali, Bhaktapur, Nepal. Corrections are welcome by phone on 01-5091616 or through the contact page, and a figure reported as wrong is checked against its published source rather than adjusted on request.
Last checked by Imperial College of Engineering. Rates, slabs and formulas are re-checked against their published source on this date.