Income Tax Exemption on Gratuity| Circumstances when gratuity can be exempted from Tax| Enterslice

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If gratuity is being received by the employee during his service, then it is entirely taxable as it is considered to be his income (under the “salary” head) under the Income Tax Act. However, if it is received on death, resignation, retirement, or other cases, then exemption from tax is granted to the employee in accordance with section 10(10) of the Act. However, in the event of the death of the employee, the nominee (or legal heir in case) shall be entitled to the gratuity sum. In furtherance of such allotment, the sum shall then be treated as the nominee’s income under the category of “Income from other sources”. To get insights into Income Tax exemption on gratuity, watch the complete video.

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