What are the minimum limit of bonus and maximum limit?

Good morning all of you.

What are the minimum limit of bonus and maximum limit?

Dear Colleague,
The Minimum Bonus is 8.33% or INR100/- which ever is higher.
The Maximum Bonus is 20 %

[10. Payment of minimum bonus.—Subject to the other provisions of this Act, every employer shall be bound to pay to every employee in respect of the accounting year commencing on any day in the year 1979 and in respect of every subsequent accounting year, a minimum bonus which shall be 8.33 per cent of the salary or wage earned by the employee during the accounting year or one hundred rupees, whichever is higher, whether or not the employer has any allocable surplus in the accounting year: Provided that where an employee has not completed fifteen years of age at the beginning of the accounting year, the provisions of this section shall have effecting relation to such employee as if for the words “one hundred rupees”, the words “sixty rupees” were substituted.]

[11. Payment of maximum bonus.—(1) Where in respect of any accounting year referred to in section 10, the allocable surplus exceeds the amount of minimum bonus payable to the employees under that section, the employer shall, in lieu of such minimum bonus, be bound to pay to every employee in respect of that accounting; year bonus which shall be an amount in proportion to the salary or wage earned by the employee during the accounting year subject to a maximum of twenty per cent, of such salary or wage. (2) In computing the allocable surplus under this section, the amount set on or the amount set off under the provisions of section 15 shall be taken into account in accordance with the provisions of that section.]

Hey Monudhiman,

A bonus is a sum of money given to a working individual as a reward for his or her good performance.

According to The Payment of Bonus Act, 1965, every organization with a headcount of 20 or above should provide its employees with the payment of bonus.

Now coming to your query, every industry and firm should pay a minimum of 8.33 percent bonus according to the bonus laws. The same law also says that the maximum bonus should not exceed 20 percent of the salary or wage of a working individual.

The payment of bonus wholly depends on one’s performance; however, the minimum and maximum amount remain the same as mentioned above.

Hope this answer helps you!

Individual employee's performance has nothing to do to pay Bonus as per Payment of Bonus Act. Where individual employee's performance is considered that is performance linked bonus not a legal requirement like Payment of Bonus Act.It is usually organization specific policy.

Bonus as per payment of bonus act depends on available surplus, allocable surplus, set on & set off.

As mentioned above minimum bonus is 8.33% and maximum bonus is 20%.

S K Bandyopadhyay ( WB, Howrah)
CEO-USD HR Solutions
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Dear Sir,
I have also one question regarding this,
Percentage wise Minimum Bonus 8.33% and Maximum Bonus 20% are ok but Rs.21000/- is maximum Bonus limit?

According to The Payment of Bonus Act, 1965, every organization with a headcount of 20 or above should provide its employees with the payment of bonus.

Bonus as per payment of bonus act depends on available surplus, allocable surplus, set on & set off. https://www.surveyzop.com/wendys-lunch-hours/ https://www.surveyzop.com/

Dear CGM,

Rs.21000-00 is the monthly salary limit for the employee's eligibility to claim statutory bonus. To constitute the salary limit only those components included in the definition of the term 'wage or salary' under the Payment of Bonus Act,1965 are taken into account. Hence minimum bonus and maximum bonus under the Act are calculated as a percentage ranging from 8.33 to 20% on the total salary thus computed and earned in the particular accounting year for which bonus is payable under the Act. Though minimum bonus is fixed in absolute terms of rupees at Rs.100/=, there is no ceiling on the maximum quantum of bonus in terms of rupees.