Finance & Tax

Nepal Gratuity Calculator

नेपाल उपदान क्याल्कुलेटर

Estimate gratuity at 8.33% of basic salary per month of service under the Labour Act 2074, and the matching provident fund.

Estimate Nepal gratuity (उपदान) from basic salary and length of service. Gratuity accrues at 8.33% of basic salary per month — roughly one month's basic pay per year — with the option to include the matching provident fund.

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Gratuity payable—

Completed service: —
Monthly gratuity accrual (8.33%): —
Gratuity (basic × 8.33% × months): —
Provident fund (both sides): —
Gratuity + provident fund: —

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About the Nepal gratuity calculator

Gratuity (उपदान) is a lump-sum payment an employer owes an employee for long service, paid when the employee resigns, retires or leaves under the scheme. This calculator estimates the amount from the monthly basic salary and the length of service, and can also show the provident fund that runs alongside it.

How gratuity is calculated

Under the Labour Act 2074 the employer sets aside 8.33% of the employee's monthly basic salary towards gratuity for every month worked. Over a full year that adds up to almost exactly one month's basic salary, so a simple way to remember the rule is "about one month's basic pay for each completed year of service". The calculator multiplies the monthly basic salary by 8.33% and then by the number of completed months of service.

Gratuity and the SSF

If the employer is registered with the Social Security Fund, the 8.33% gratuity is deposited into the SSF as part of the employer's 20% contribution, and the employee receives it under the fund's rules. If the employer cannot deposit it, the employer must still provide the 8.33% separately — the obligation does not disappear. Employees in workplaces not covered by the SSF receive gratuity directly from the employer.

Gratuity compared with provident fund

Provident fund is a separate contribution: 10% is deducted from the employee's salary and the employer matches it with another 10%, so both sides build up a savings balance. This calculator shows the combined provident fund alongside gratuity when the option is ticked, so you can see the total payable on leaving.

Enter your own details

Gratuity depends on the definition of basic salary in your contract and on the exact dates of service, so treat the figure as an estimate. Confirm the amount with your employer or, where applicable, with the Social Security Fund.

Frequently asked questions

How is gratuity calculated in Nepal?

Under the Labour Act 2074 the employer contributes 8.33% of the employee’s monthly basic salary towards gratuity for each month of service. Multiply the monthly basic salary by 8.33% and then by the number of completed months worked.

How much gratuity do I get per year?

8.33% of basic salary per month works out to almost exactly one month’s basic salary for each completed year of service. So five years on a Rs 30,000 basic salary gives roughly Rs 1,50,000 of gratuity.

Is gratuity paid through the SSF?

If your employer is registered with the Social Security Fund, the 8.33% gratuity is deposited there as part of the employer’s 20% contribution and is paid under the fund’s rules. If not, the employer must still provide it directly.

Do I get gratuity if I resign?

Gratuity accrues with service, and an employee who leaves after completing the qualifying service is entitled to it. The exact terms — including any minimum service period — follow the Labour Act and your employment contract.

Is gratuity different from provident fund?

Yes. Gratuity is an employer-funded service benefit of 8.33% of basic salary per month, while the provident fund is 10% deducted from the employee plus a 10% employer match. Both are shown here, but they are separate entitlements.

Is gratuity taxable?

Gratuity paid on retirement or leaving generally has a tax treatment set by the income tax rules, and the exempt limit can differ from the provident fund. This calculator shows the gross amount before any tax.