I would like to know how to calculate the bonus for employees and the periodicity, i.e., from which month of the previous year to which month of this year an employee will be eligible for a bonus, say a minimum of 8.33%. Additional components can also be considered based on individual performance.
The main doubt is that since the bonus chapter typically opens during the event of Diwali, which occurs in the month of October or November every year, whereas the financial year runs from April to March. Tax factors also need to be properly considered.
I request expert help from you.
Thank you in anticipation.
V.G. Kalyana Raman
Manager - HR
+91 98403 22799
From India, Madras
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The main doubt is that since the bonus chapter typically opens during the event of Diwali, which occurs in the month of October or November every year, whereas the financial year runs from April to March. Tax factors also need to be properly considered.
I request expert help from you.
Thank you in anticipation.
V.G. Kalyana Raman
Manager - HR
+91 98403 22799
From India, Madras
Acknowledge(0)Amend(0)
Dear Mr. Raman,
Recently, an ordinance, The Payment of Bonus (Amendment) Ordinance, was promulgated by the President. All those employees drawing Basic + DA up to Rs 10,000 per month are eligible to get a bonus. For the calculation of the bonus, the maximum Basic+DA to be considered is Rs. 3,500 per month. If you calculate the minimum bonus at 8.33% of (Basic + DA) for the complete year, it will amount to one month's (Basic+DA). In short, the minimum bonus to be paid for the year is one month (basic+da), subject to a maximum of Rs. 3,500.
As for the period, it is usually taken as the financial year in most cases. However, some companies also consider the period up until the month of Diwali when calculating bonuses.
Amit Goyal
9811558950
From India, Delhi
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10Recently, an ordinance, The Payment of Bonus (Amendment) Ordinance, was promulgated by the President. All those employees drawing Basic + DA up to Rs 10,000 per month are eligible to get a bonus. For the calculation of the bonus, the maximum Basic+DA to be considered is Rs. 3,500 per month. If you calculate the minimum bonus at 8.33% of (Basic + DA) for the complete year, it will amount to one month's (Basic+DA). In short, the minimum bonus to be paid for the year is one month (basic+da), subject to a maximum of Rs. 3,500.
As for the period, it is usually taken as the financial year in most cases. However, some companies also consider the period up until the month of Diwali when calculating bonuses.
Amit Goyal
9811558950
From India, Delhi
Acknowledge(0)Amend(0)
All those employees drawing Basic + DA up to Rs 10,000 per month are eligible to get a bonus. For the calculation of the bonus, the maximum Basic + DA to be considered is Rs. 3,500 per month. I'm confused by these two statements. Please clarify.
From India, Mumbai
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From India, Mumbai
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Amendment to Payment of Bonus Act 2015.jpg
Bigger bonuses for more as Lok Sabha amends Payment of Bonus Act - The Economic Times.pdf
THE PAYMENT OF BONUS ACT.doc