Group Gratuity Scheme
Retirement benefits for loyal employees with lump sum payment upon retirement or resignation.
What is Group Gratuity Scheme?
Retirement benefits for loyal employees
A Group Gratuity Scheme is a type of employee benefit plan that provides a lump sum payment to employees upon retirement or resignation, based on their length of service and salary. In this plan, employers contribute to the scheme, and the funds are managed by a life insurer or a trust, and the employees are covered under a single scheme.
It provides a lump sum payment to employees on retirement or after a specified period of service. Under Group Gratuity Scheme, contributions made by employers are tax-deductible.
This plan helps employee retention, attract and retain talent by providing a valuable retirement benefit. Mainly it provides a lump sum payment to employees, helping them meet their financial goals. Employers keep a portion of the gratuity liability funded each year to insurance companies and purchase an insurance policy to cover the gratuity liability. Employers need to ensure sufficient funding to meet the gratuity liability and must comply with relevant laws and regulations, such as the Payment of Gratuity Act.
It provides a lump sum payment to employees on retirement or after a specified period of service. Under Group Gratuity Scheme, contributions made by employers are tax-deductible.
This plan helps employee retention, attract and retain talent by providing a valuable retirement benefit. Mainly it provides a lump sum payment to employees, helping them meet their financial goals. Employers keep a portion of the gratuity liability funded each year to insurance companies and purchase an insurance policy to cover the gratuity liability. Employers need to ensure sufficient funding to meet the gratuity liability and must comply with relevant laws and regulations, such as the Payment of Gratuity Act.
Key Features:
- Lump sum on retirement/resignation
- Based on service length & salary
- Tax-deductible contributions
- Compliant with Gratuity Act
- Helps employee retention
- Professional fund management
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What is a Group Gratuity Scheme?
A retirement benefit scheme where employers contribute to a fund for employees' gratuity benefits.
What are the key features of Group Gratuity Scheme?
Employer contributions to a trust fund, payout on retirement, death or resignation (after 5 years of service), and tax benefits for employer contributions.
What are the benefits of Group Gratuity Schemes?
Retirement savings for employees, tax efficient for employers, and secure gratuity payout.