Can Employer Pay Bonus to EMployee in Two Parts like 50% as a Bonus & 50% in PF Account???
From India, Vadodara
4From India, Vadodara
PROFESSIONALS AND BUSINESSES PARTICIPATING IN DISCUSSION
PF & Bonus are statutory. You need to contribute towards PF in accordance with Employees Provident Fund and Miscellaneous Provisions Act, 1952 and you need to make payment of minimum statutory Bonus, in accordance with Payment of Bonus Act
From India, Aizawl
From India, Aizawl
Thank you for Reply but still i have one confusion.... We paid as an employer minimum amount as a bonus and rather than that amount can we pay bonus amount in PF account????
From India, Vadodara
From India, Vadodara
You can pay even 20% as Bonus payment depending upon the profit of company (or more but terminology used is "ex-gratia" instead of bonus).
But 8.33% as statutory minimum bonus.
In Provident fund, contributions are deposited based on the wages/salary earned by
the employee. However, as per Income Tax Act, Bonus is part of salary in the hands of employee
and taxable also.
'As per the provision of the Income Tax Act, 1961, the amount of compensation due or received by an employee from his employer in connection with an employment shall be taxable as salary in the hands of the employee. Accordingly, the bonus receivable by you shall be taxable in your hands as salary income'
Contributions towards PF shall be made on the basis of the monthly wages/salaries of employees.
You can not increase employers' contribution towards PF just for a month.
From India, Aizawl
But 8.33% as statutory minimum bonus.
In Provident fund, contributions are deposited based on the wages/salary earned by
the employee. However, as per Income Tax Act, Bonus is part of salary in the hands of employee
and taxable also.
'As per the provision of the Income Tax Act, 1961, the amount of compensation due or received by an employee from his employer in connection with an employment shall be taxable as salary in the hands of the employee. Accordingly, the bonus receivable by you shall be taxable in your hands as salary income'
Contributions towards PF shall be made on the basis of the monthly wages/salaries of employees.
You can not increase employers' contribution towards PF just for a month.
From India, Aizawl
Clubbing of allowances with basic pay under PF Act.pdf
Amendment to Payment of Bonus Act 2015.jpg