Group Gratuity Trust Compliance | Savlana Init

Gratuity Trust · Group Compliance

Group Gratuity Trust Compliance — One Scheme, Many Employers, Clean Records.

Group gratuity schemes pool multiple employers under one master trust or insurer policy — which means compliance has to track each participating employer separately while keeping the master structure clean.

A group gratuity trust — often set up by a parent company or arranged through an insurer's master policy — allows multiple group companies to participate in a single trust structure rather than each setting up and maintaining its own. This reduces administrative duplication, but it also means compliance has to be tracked at two levels: the master trust's own Income Tax approval and governance, and each participating employer's individual liability, contribution, and actuarial position within the shared fund.

Common compliance touchpoints specific to group structures include onboarding a new group company into the master trust (which typically needs a formal participation agreement and trustee resolution), tracking each employer's separate sub-account or notional share within the pooled fund, and handling an employer's exit from the group scheme if it's divested or restructured.

We manage this two-level compliance — keeping the master trust's approval and filings current while ensuring each participating employer's contribution and liability records are correctly maintained and don't get commingled inappropriately.

Our Group Compliance Services

Master Trust Compliance Oversight

Tracking the group trust's own Income Tax approval status, trustee governance, and annual filings.

New Employer Onboarding

Preparing the participation agreement and trustee resolution needed to add a new group company to the master trust.

Per-Employer Sub-Account Tracking

Ensuring each participating employer's contribution history and liability are correctly tracked within the pooled structure.

Employer Exit/Divestiture Processing

Handling the exit of a group company from the master trust when it's sold, divested, or restructured out of the group.

Group-Level Actuarial Coordination

Coordinating consolidated and per-employer actuarial valuations for the group scheme.

Master Policy-Insurer Liaison

Acting as liaison with the insurer managing the master group gratuity policy on behalf of all participating employers.

Cross-Employer Reconciliation

Periodic reconciliation to confirm pooled fund allocations match each employer's actual liability and contribution record.

Group Compliance Reporting

Consolidated compliance reporting to group finance covering all participating employers under the trust.

Our Process

Group Structure Review

We map which entities currently participate in the master trust and how their sub-accounts are tracked.

Master Trust Status Check

The group trust's own Income Tax approval and governance status is verified as current.

Per-Employer Reconciliation

Each participating employer's contribution and liability records are reconciled against the pooled fund.

Onboarding/Exit Processing

Any new entities joining or existing entities exiting the scheme are processed with the required agreements and resolutions.

Consolidated Reporting

A group-level compliance report is prepared covering the master trust and all participating employers.

Why It Matters

✓Master trust and per-employer compliance tracked at both levels correctly

✓New group companies onboarded with proper participation documentation

✓Divesting entities exited from the scheme without leaving records unreconciled

✓Consolidated actuarial and contribution reporting across the group

✓Single insurer liaison point representing all participating employers

✓Reduces duplication versus each group company running its own trust

✓Cross-employer reconciliation catches allocation mismatches early

✓Group finance gets one consolidated compliance view instead of fragmented reports

Frequently Asked Questions

A group gratuity trust is a single master trust (or insurer master policy) that multiple related employers participate in, rather than each employer setting up its own trust. It reduces administrative duplication but requires tracking each participating employer's liability and contribution separately within the shared structure.

Typically through a formal deed of adherence or participation agreement, along with a trustee resolution admitting the new entity, after which its employees' gratuity liability and the corresponding contributions are tracked within the master trust structure.

The divesting entity generally needs to exit the master scheme, with its proportionate corpus either transferred to a new standalone/successor trust or settled according to the trust deed's exit provisions — this needs careful handling to avoid gratuity funding gaps for its employees.

This depends on how the scheme is structured — some master trusts hold a single approval covering all participating employers under the deed's terms, while others require each employer's participation to be separately reflected. We review the specific deed to confirm which applies.

While the corpus may be invested together for efficiency (particularly under an insurer's master policy), proper governance requires that each employer's contribution and liability are tracked separately, even within a pooled investment structure, so no employer's funding is misallocated to another.

Typically the master trust's trustees, often supported by the parent company's finance function, act as the single liaison point with the insurer — which is the coordination role we support to avoid each group company separately managing the insurer relationship.

Managing a multi-employer group gratuity scheme?

We'll keep the master trust compliant while tracking each participating employer's contribution and liability correctly.