Payment of gratuity
Monica Bansal
(Querist) 02 May 2013
This query is : Resolved
In context of payment of Gratuity as per Gratuity Act 1972, In case an employee's eligibility exceeds the prescribed limit of 10 lacs, then in what form the Gratuity is Payable to the employee?
Guest
(Expert) 02 May 2013
In the same form, as in the case of gratuity up to ten lakhs. The only question is the limit for exemption from tax, not the form of payment. For balance, exceeding ten lakhs, you will have to make TDS.
Monica Bansal
(Querist) 02 May 2013
Thank you Mr. Dhingra.
can this payment be received during the tenure of the service of the employee? or is it paid after retirement/resignation?
Also, is it possible that it does'nt form part of CTC?
Guest
(Expert) 02 May 2013
Dear Monica,
Gratuity to an employee is payable only on retirement/ termiation of his service, not during his service with the organisation.
Gratuity, being a statutory post-service liability of the employer, should not be linked with the CTC.
