Gratuity Trust Registration under the Income Tax Act

Gratuity liabilities don’t appear overnight. They build year after year.

When an employee exits, the payout often becomes a sudden financial hit. Registering a Gratuity Trust under the Income Tax Act helps employers plan this obligation in advance while also securing tax benefits on contributions.

At N D Savla & Associates, we assist employers with end-to-end Gratuity Trust registration and approval, ensuring the structure is compliant, practical, and sustainable.

What Is Gratuity Trust Registration?

Gratuity Trust registration involves creating an irrevocable trust and obtaining approval from the Income Tax Department. Once approved, contributions made by the employer to the trust are allowed as deductible business expenses, and gratuity payouts are made from the trust fund.

This shifts gratuity from a reactive payout to a planned financial arrangement.

Why Register a Gratuity Trust?

Tax Deduction on Contributions
Contributions to an approved Gratuity Trust are allowed as business expenditure under the Income Tax Act.
Planned Cash Outflow
Avoid large, one-time gratuity payouts impacting working capital.
Regulatory Compliance
Aligns gratuity payments with statutory and tax requirements.
Employee Assurance
Gratuity obligations are backed by a dedicated and protected fund.

Our Gratuity Trust Registration Services

Drafting of Gratuity Trust Deed

Preparation of irrevocable trust deed as per income tax rules
Structuring trustee roles and responsibilities

Actuarial Valuation

Coordination with certified actuary
Computation of gratuity liability for approval purposes

Application for Income Tax Approval

Filing of Gratuity Trust approval application
Documentation and representations before authorities

Follow-ups & Approval

Handling notices, queries, and clarifications
End-to-end support until approval is granted

Documents Required

Certificate of Incorporation / Firm Registration
Draft Gratuity Trust Deed
List of trustees with PAN details
Employee service records
Actuarial valuation report
PAN of employer and trust

Who Should Opt for Gratuity Trust Registration?

Companies covered under the Payment of Gratuity Act
Employers with long-serving employees
Growing organisations planning employee benefit structures
Businesses seeking tax-efficient gratuity management

Why N D Savla & Associates ?

Gratuity Trust registration is not just a filing exercise. It involves coordination between tax law, labour compliance, and actuarial valuation.

Clients rely on us because:

We handle the complete process under one roof
We focus on practical, implementable structures
We manage follow-ups with the Income Tax Department
We continue advisory support after approval

Get Started

If gratuity liabilities are increasing or payouts are affecting cash flow, registering a Gratuity Trust is a structured way forward.

Speak with N D Savla & Associates to initiate Gratuity Trust registration under the Income Tax Act.