Aster latest news Gratuity ceiling limit for private sector employees has been doubled to Rs. 20 lakhs which will be tax free. Indian government has decided to bring an amendment to increase gratuity limit of private sector employees.
Based on amendment of Gratuity (Amendment) Bill in Parliament as proposed by Cabinet meeting under Indian Prime Minister Narendra Modi there will be change in gratuity ceiling limit for tax calculation.
This decision was taken on Tuesday 12th September 2017 by Cabinet meeting that decided to double the gratuity limit for private employees working in company, industries, establishments and various factories. Gratuity is payable to an employee who has completed 5 years or more in a company. Based on present amendment of gratuity bill all private employees will be entitled to get up to rupees 20 lakhs tax free gratuity based on their service.
New gratuity limit will be rupees 20 lakh compared to earlier limit of rupees 10 lakh for private employees that will be exempted from tax. Central government will introduce Payment of Gratuity (Amendment) Bill, 2017 in Parliament which will be made into a law.
Details of Gratuity ceiling limit of private sector under Gratuity Amendment Bill
With Gratuity Amendment Bill gratuity ceiling limit of private sector employees will be increased up to Rs 20 lakhs which will be tax free.
Only private sector employees who are employed in a company or establishments that has 10 or more employees will get benefits of amendment of Gratuity Act.
Gratuity is an important source of income for a person after he gets retirement from an establishment. Gratuity ceiling limit for private sector employees is amended as per decision on 12-9-2017. This factor makes increasing ceiling limit of exemption of tax for private employees a very good decision from cabinet. This decision was taken in first meeting held after reshuffle of cabinet ministers under Prime Minister Narendra Modi.
News – Cabinet approval of Tax free Gratuity limit hiking
After amendment of Gratuity Act all private employees in India are looking for gratuity calculators. So how to get latest calculation formula based on new tax free gratuity limit of private employees. There are also calculators, softwares, apps available in Play Store and excel sheets for calculation of gratuity. Read more – Gratuity calculator download 2017
Indian government decided to bring a revision in ceiling limit of gratuity based on present inflation and wage increase.
This new Amendment Bill benefit all private employees coming under the Payment of Gratuity Act, 1972.
Gratuity limit for central government employees was hiked to Rs 20 lakh based on 7th pay commission (7th CPC) recommendations. Central government employees were getting this tax free gratuity ceiling amount from 1st January 2016.