Gratuity calculator
Estimate an indicative end-of-service gratuity from your last drawn monthly basic salary, years of service and a per-year factor — using gratuity = basic × years × factor.
Important: under the Labour Act 2074 and the Social Security Fund (SSF), gratuity is now contribution-based. This is a legacy, planning-level estimate, computed in your browser.
Service details
Use the basic salary only — not gross pay including allowances.
Total completed years with the employer. Decimals allowed.
How many months of basic salary are credited for each year served. Many legacy schemes used one month per year; some service rules used more.
Note: under the Labour Act 2074 (2017) and the Social Security Fund (SSF), gratuity is now contribution-based — the employer deposits a monthly percentage of basic salary into the SSF rather than paying a lump sum at exit. The figure below is a legacy / indicative estimate only.
Indicative gratuity
Rs 4,00,000
10 months of basic salary credited
Monthly basic
Rs 40,000
Years of service
10 yrs
Factor
1 mo/yr
| Formula | monthly basic × years × factor |
| Calculation | Rs 40,000 × 10 × 1 |
| Indicative gratuity | Rs 4,00,000 |
A legacy, planning-level estimate computed in your browser. Since the Labour Act 2074 and the Social Security Fund, gratuity in the formal sector is generally accrued through monthly SSF contributions rather than a single end-of-service lump sum. Always confirm the entitlement with your contract, the employer's service rules, the SSF and current law.
From basic salary to a gratuity estimate
The legacy lump-sum approach multiplies the last drawn monthly basic by the years served and a per-year factor — giving the total months of salary credited at exit.
Monthly basic
Start from the last drawn monthly basic salary — basic pay only, excluding allowances, bonuses and overtime.
Years × factor
Multiply completed years of service by the factor (months of salary credited per year) to get the months payable.
Gratuity
Gratuity = basic × years × factor. Under the SSF this is now generally accrued via monthly contributions instead.
Gratuity, answered
How is gratuity calculated in Nepal?+
A common legacy estimate is gratuity = last drawn monthly basic salary × completed years of service × a factor (months of salary credited per year, often one month per year). For example, a Rs 40,000 basic with 10 years of service at a factor of 1 gives 40,000 × 10 × 1 = Rs 400,000. This calculator uses that simple formula as an indicative figure.
Is gratuity still a lump sum under the Labour Act 2074?+
Largely no. After the Labour Act 2074 (2017) and the launch of the Social Security Fund (SSF), gratuity in the formal sector became contribution-based: the employer deposits a fixed monthly percentage of the employee's basic salary into the SSF, rather than paying a single end-of-service lump sum. The lump-sum formula here is therefore a legacy or indicative estimate, not the current statutory entitlement for SSF-enrolled workers.
What is the factor (months of salary per year)?+
The factor is how many months of basic salary are credited for each completed year of service. Many older gratuity schemes used one month of salary per year served; some service rules used more. Adjust the factor to match the specific scheme, contract or service by-law that applies to you.
Should I use basic salary or gross salary?+
Gratuity is generally based on basic salary, not gross pay that includes allowances. Enter only the last drawn monthly basic so the estimate is not inflated by allowances, bonuses or overtime.
Is this calculator an official entitlement figure?+
No. It is an indicative, planning-level estimate computed in your browser. Your actual entitlement depends on your contract, the employer's service rules, your SSF contribution history and current law. Always confirm the amount with the employer, the Social Security Fund and a qualified adviser.
Sources & data note
Based on the legacy gratuity relation gratuity = monthly basic × years of service × factor. Under the Labour Act 2074 (2017) and the Social Security Fund (SSF), formal-sector gratuity is contribution-based rather than a lump sum, so figures here are indicative only. Verify your entitlement against your contract, employer service rules, the SSF and current law — this is not legal or financial advice.