Hello, Could you assist me in determining the accuracy of this breakup? Do I need to make any modifications? We have transitioned to disbursing the statutory bonus on a monthly basis, which used to be included in the annual component. Now that we're making monthly payments for the statutory bonus, where should I specify this component in the monthly structure?
From India, Lucknow
From India, Lucknow
There are lot of issues with the break up. But your apprehension is only with reference to payment of bonus monthly, right? Therefore, let me answer it first. You cannot pay statutory bonus in monthly instalments. There are two issues. First, bonus is actually a deferred wages paid annually to make the employee comfortable with a certain sum. Second, the bonus pertaining to a financial year should be paid within eight months of that financial year. That is law. That means you can stretch beyond 8 months.
The other comments: You are calculating the EPF contribution on Basic pay only. You should consider supplementary allowance also and then cap it to Rs 15000. The LTA should not form part of Salary break up but you can put it outside the Salary and form part of Cost to Company.
The Net salary means the take home salary and it should be the salary after deducting the PF, TDS etc. You can add Employer's contribution to PF, Bonus, LTA and even Gratuity (not right practice, I would say) to Gross salary (ie, salary before deducting employees' contribution to PF) and make it Cost to Company.
From India, Kannur
4193The other comments: You are calculating the EPF contribution on Basic pay only. You should consider supplementary allowance also and then cap it to Rs 15000. The LTA should not form part of Salary break up but you can put it outside the Salary and form part of Cost to Company.
The Net salary means the take home salary and it should be the salary after deducting the PF, TDS etc. You can add Employer's contribution to PF, Bonus, LTA and even Gratuity (not right practice, I would say) to Gross salary (ie, salary before deducting employees' contribution to PF) and make it Cost to Company.
From India, Kannur
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