Dear HR Friend’s, Can anyone tell me what is ex-gratia and when it’s paid, what’s the max. limit and is taxable or non-taxable? Ashish Kumar
From India, Mumbai
11From India, Mumbai
Dear Ashish Kumar,
For bonus payment there are several limitation under the Payment of Bonus Act viz. 1) Salary limit, i.e Rs.10,000. 2) Limit on salary for bonus calculation, i.e Rs. 3,500. 3) Limit on percentage, i.e 20% etc. If the Organization is able and ready to pay beyond these limits, it is called ex-gratia. Accordingly there is no limit for ex-gratia, but in compliance with the affordability and discretion of Management.
The maximum time limit for Bonus payment is 8 months from the financial year. Normally the payment may be connected with any festiavals within the period viz. Deepavali, Ganesha Chathurthi, Onam etc. Ex-gratia will also be disbursed during these time. Bonus/ ex-gratia payments will attract Income Tax.
Abbas.P.S
From India, Bangalore
For bonus payment there are several limitation under the Payment of Bonus Act viz. 1) Salary limit, i.e Rs.10,000. 2) Limit on salary for bonus calculation, i.e Rs. 3,500. 3) Limit on percentage, i.e 20% etc. If the Organization is able and ready to pay beyond these limits, it is called ex-gratia. Accordingly there is no limit for ex-gratia, but in compliance with the affordability and discretion of Management.
The maximum time limit for Bonus payment is 8 months from the financial year. Normally the payment may be connected with any festiavals within the period viz. Deepavali, Ganesha Chathurthi, Onam etc. Ex-gratia will also be disbursed during these time. Bonus/ ex-gratia payments will attract Income Tax.
Abbas.P.S
From India, Bangalore
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