Is Your Bonus Calculated on Total Salary or Just the Basic? Let's Discuss!

I want to know whether a bonus is payable on the total salary or just on the basic salary.

Thank you.
Ashok

Dear Ashok,

The bonus is calculated based on basic salary + DA, ranging from 8.33% to 20%, depending on your organization's ability to pay.

Regards,
Ambarish
Ph: 9164950110

Dear Ashok,

Bonus is paid on salary or wage as defined under section 2(21) of the Payment of Bonus Act, 1965.

Regards,
R.N. Khola

I want to know whether bonus is payable on total salary or on basic only.

Thank you,
Ashok

Bonus will be calculated at 3500/- basic per month. However, if the basic amount for any respective month is less than 3500/-, the bonus will be calculated based on the present basic amount for that month.

April: 3500
May: 3500
June: 3300
July: 3250
August: 3500

Total: 17050

The amount payable will be calculated as follows: 17050 * percentage of bonus.

It is payable on the basic salary plus DA, as per the Payment of Bonus Act. The minimum payable is 8.33%, and the maximum is determined by the discussion of the board members.

I just want to know more about whether companies give bonuses every month.

Payment of Bonus Act 1965 states that 8.33% is equivalent to 1 month's salary, up to 20% which is equivalent to 2 and a half months' salary - this is the maximum bonus a company can pay according to the Payment of Bonus Act 1965. The actual bonus amount depends on the company's policy, allocable surplus, and available surplus. Bonuses are calculated based on Basic + DA.

Hi Ashok,

As per the Payment of Bonus Act 1965, a bonus is payable on basic wages if the company is giving D.A. to workers; then D.A. should also be considered in this calculation.

For the computation of the Bonus, Rs. 3500/- per month as basic will be considered and will be reflected as per the paydays of employees. The maximum limit for the payment of the bonus is 20%, and the minimum is 8.33%. Bonuses will be payable on an annual basis, and the period will be the accounting year, which is April to March. For further clarification, you can contact me.

Thanks & Regards,
Sunil Sharma
Mob: 9910126718

It is calculated based on your earned basic salary plus DA from your last year. The minimum bonus rate is 8.33%, and the maximum depends on your organization's capability.

Definition of "Salary or Wage" Under the Bonus Act

Under the Bonus Act, the definition of "Salary or wage" means all remuneration (other than remuneration in respect of overtime work) capable of being expressed in terms of money. This remuneration would be payable to an employee if the terms of employment, express or implied, were fulfilled, or for work done in such employment. It also includes dearness allowance, which refers to all cash payments, by whatever name called, paid to an employee on account of a rise in the cost of living.

There is a deficit in the definition of salary/wage regarding whether the Bonus is applicable to basic and DA only or if it includes all allowances for the cost of living (as per the above statement). Please provide supporting documents or proof for clarification.