Limit For Gratuity For Private Employees Enhcnaced to Rs 10 Lakh!


CBDT enhances exemption to Gratuity upto Rs 10 lakh !

The Union cabinet today cleared a proposal to raise the ceiling for payment of gratuity to private sector employees from Rs 3.5 lakh to Rs 10 lakh. The Government employees already get enhanced gratuity of Rs 10 Lakh vide acceptance of recommendation of Sixth Pay Commission.

Till now , however , the exemption is limited to Rs 3.5 Lakh . So , it is reported that Govt will soon issue order that will exempt gruity up to Rs 10 Lakh.


  1. I had been eagerly awaiting the raising of the ceiling of Gratuity payments to Rs.10 lakhs for Non-Government employees covered by Gratuity Act. Yesterday’s decision of the cabinet gives a glimmer of hope. But most of the Central PSUs have already paid the Salary/Gratuity/Leave Encashment arrears to the emplyees in the last few months after deducting IT as per extant rules consequent upon the revision of pay scales. What happens in these cases?