1. Gratuity is given by the employer to an employee for the services rendered by him. It is usually paid at the time of retirement but it can be paid before provided certain conditions are met.

As per Sec 10 (10) of Income Tax Act, gratuity is paid when an employee completes 5 or more years of full time service with the employer (minimum 240 days a year). However, it can be paid before the completion of five years at the death of an employee or if he has become disabled due to accident or disease.

There is no set percentage stipulated by law for the amount of gratuity an employee is supposed to get - an employer can use a formula-based approach or even pay higher than that.

Gratuity payable depends on two factors: Last drawn salary and years of service.

To calculate how much gratuity is payable, the Payment of Gratuity Act, 1972 has divided non-government employees into two categories:

a) Employees covered under the Act

b) Employees not covered under the Act

2. An employee will be covered under the Act if the organisation employees at least 10 persons on a single day in a preceding 12 months. And once an organisation comes under the purview of the gratuity Act, then it will always remain covered even if the number of employees is falls below 10.

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3. Gratuity is a sum of money that the employer pays to the employee for services rendered in the company. But, the sum is given once the employee completes 5 or more years in the same company. The gratuity amount is completely paid by the employer unlike provident fund where the employee too contributes. In India, there exists a Payment of Gratuity Act, 1972 for regulation of gratuity payments by the employer. The Act covers companies that have more than 10 employed at factories, mines, oilfields, plantations, ports, railway companies, shops or other related establishments.

4. Gratuity is a sum of money paid by an employer to an employee for services rendered in the company. However, gratuity is paid only to employees who complete 5 or more years with the company. It can be understood as a form of tip paid by employer to the employee for services offered in the company.

5. A gratuity fund is a part of the salary an employee receives from his/her employer in gratitude for the work the employee does for the company. Gratuity is a defined benefit plan and is mostly a retirement benefit offered by the company to the employee upon leaving his/her job. It can have some tax advantages. It varies a lot from company to company and depends on your countries tax regulations.

6. Gratuity is a defined benefit scheme and mandatory payment b an employer covered under payment of gratuity act 1972. This act states that every establishment which has or had employed 10 or more persons on the payrolls on any day of preceding 12 months, has to show gratitude to its employee who has rendered at least 5 years of continuous service by paying a Gratuity amount as per the gratuity calculation formula specified under this act. An establishment which does not cover under this act may also pay gratuity.