Employee Benefits
Credit Life
Group Pensions
Non Unit Linked
Tata AIG Comprehensive Superannuation Scheme Policy
Tata AIG Comprehensive Gratuity Scheme
Group Immediate Annuity with return of Purchase Price
Unit Linked
Retirement Assure Group Superannuation Scheme (Unit Linked)
Retirement Assure Group Gratuity Scheme (Unit Linked)
Retirement Assure Group Gratuity Scheme (Unit Linked)


Retirement Assure Group Gratuity Scheme (Unit Linked)

 As per the Payment of Gratuity Act 1972, an employer is obliged to pay gratuity to an employee after he/she has rendered a continuous service of at least 5 years. Gratuity is payable to such an employee on:

  • Normal retirement
  • Resignation/early retirement
  • Death or disablement due to accident or disease (completion of 5 years of service is not necessary in such cases).
If the Employer’s Gratuity Rules provide for higher benefits as compared to the Payment of Gratuity Act 1972, the benefits will be paid as per the Employers’ Gratuity Rules.

Tata AIG’s Retirement Assure Group Gratuity Scheme (Unit Linked) is designed to help you bear the financial burden of paying gratuity and provide you with an opportunity of earning returns on the funds invested.

How will the Employer/Trustee contribute to the Gratuity Scheme?

Employer/Trustee of the Gratuity Scheme shall fund for gratuity liability by:
  • Remitting the recommended contribution for the past service and an annual contribution for the future service
  • Transferring existing assets if any to Tata AIG Life based on mutually agreed asset valuation
How does the Unit Linked Gratuity Plan Structure work?

  • The Fund will be managed on a unitized basis.
  • Any contribution received will be converted into units based on the applicable fund unit price.
  • The fund value of the Gratuity Fund at any given time is based on the unit price declared at the close of business on the date on which the units are allocated

Can an Employer/Trustee decide on asset allocation?

An Employer/Trustee has the flexibility to decide the ratio of investment based on their risk taking appetite. They can invest in any of the following :

  • Upto 100% in Short Term Fixed Income Fund
  • Upto 100% in Bond Fund
  • Upto 100% in Growth Fund
  • Upto 100% in Balanced Fund
  • Any combination of the above with a maximum of 60% in Equity Fund
    Tax Benefits for the Employer*:
    • Past Service Contribution is allowed as deductible business expense to the extent of 8.33% of the member's salary during the each year of employee's past service. (Rule 104)
    • Contributions up to 8.33% of the employees salary is allowed as deductible business expense u/s 36 (1)(v).
    • Interest Income on the fund is non taxable in the hands of the Trustees u/s 10(25) (iv).
    Tax Benefits for the Employee*:

    Gratuity received is exempt from tax up to half a months salary for every completed year of service or Rs. 3.5 lakhs, whichever is less u/s 10(10).

    * Tax laws are subject to amendments thereof and for more details please get in touch with your tax consultant

    In Built Death Benefit:

    As part of the scheme, an additional benefit of Life Insurance Cover is included.

    In the unfortunate event of a serving employee's death, the coverage would provide for a lump sum payment equal to sum assured depending on the life cover opted by the Trustees with a minimum of Rs. 1,000/-.
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    UIN - 110L051V01
    Contact Us
    For further information on our corporate products, Please contact our Corporate Sales Department at
    1-800-11-9966.
    Email:
    pensions@tata-aig.com
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