Fund your statutory gratuity liability seamlessly under The Payment of Gratuity Act, 1972. Optimize actuarial reserves, earn superior fund yields, and claim 100% tax deductions under Section 36(1)(v).
Understanding employer obligations, trust structuring, and statutory fund management.
Under The Payment of Gratuity Act, 1972, every Indian enterprise, factory, and commercial establishment employing 10 or more people is legally obligated to pay a lump-sum gratuity to employees upon retirement, resignation, superannuation, or death after completing at least 5 years of continuous service.
Gratuity is calculated as 15 days of last drawn basic salary plus dearness allowance (DA) for every completed year of service. Rather than paying gratuity out of fluctuating monthly operational cashflows, leading corporate employers establish an Approved Gratuity Trust connected to a Group Gratuity Scheme managed by top-rated life insurers.
Calculated strictly on (15 × Last Drawn Basic Salary × Years of Service) ÷ 26 as defined by Indian law.
An irrevocable trust ensures corporate funds are completely ring-fenced and protected exclusively for employees.
Trust interest earnings compound tax-free, creating an ever-expanding corpus that cushions corporate liability.
Why leading startups, MSMEs, and large corporations transition from unfunded provisions to structured gratuity trusts.
Contributions paid towards an Approved Gratuity Trust are treated as deductible business expenses, substantially lowering your corporate tax liability.
Earn attractive 7.5% to 8.5% annual returns on gratuity reserves through professionally managed sovereign debt and gilt portfolios of top life insurers.
In the unfortunate event of an employee's untimely demise, the scheme pays gratuity calculated for the full service period up to retirement age.
Receive certified AS 15 / Ind AS 19 actuarial valuation reports seamlessly for statutory balance sheet disclosures and auditor sign-offs.
A transparent, 3-step actuarial and institutional setup managed end-to-end by our corporate advisory team.
Step 1
We evaluate your employee census (age, tenure, salary) to calculate exact accrued past service and future gratuity liability.
Step 2
We assist in drafting the Gratuity Trust Deed and benchmark top institutional insurers (LIC, HDFC Life, ICICI Pru, SBI Life) for maximum yields.
Step 3
Your corporate gratuity scheme is activated with automated fund accounting, tax exemptions, and fast claim payouts upon employee exit.
Compare returns, fund allocation structures, and tax savings across top-rated life insurers with our corporate consultants.
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Everything HR heads, CFOs, and finance teams need to know about statutory gratuity fund management.
