Why is the entire gratuity amount being treated as taxable in Keka?

This happens when the setting “Pay entire gratuity amount as taxable” is enabled during the exit process.

When this option is checked, 100% of the gratuity amount is taxed, regardless of applicable exemptions.

How to fix it:

1. Go to Org → Exits → Exit Process → Exited Employees

2. Search for the employee’s name

3. Click Manage → Finances → Review and Finalize

4. Scroll to the “Others” section → Gratuity

5. Disable the setting: “Pay entire gratuity amount as taxable”

6. Save changes to apply the updated taxation rule

This ensures only the taxable portion of gratuity is deducted, based on applicable laws.