Effective 1st January 2024, the government of India has decided to raise the gratuity limit of central govt employees by 25%. With this raise, the gratuity limit has increased from ₹20 lakh to ₹25 lakh.
Need less to mention, tax liability becomes nil for any Gratuity payouts upto the ceiling for that set of employees.
We may soon expect Payment of Gratuity Act 1972, too getting amended to accommodate this change for Private sector employees. At present this stands unrevised at ₹ 20 Lakh.
