Hi Karthik,
I would be happy to help you with calculating bonuses for your employees. Here are some key points to consider:
1. Is it compulsory to pay bonuses to all employees?
2. Who is eligible to receive a bonus?
3. What are the minimum and maximum percentages for bonuses?
4. Please let me guide you through the entire calculation process.
Feel free to provide more details or ask any specific questions you may have.
Regards,
Karthik P
From India, Thrissur
Acknowledge(0)
Amend(0)
3I would be happy to help you with calculating bonuses for your employees. Here are some key points to consider:
1. Is it compulsory to pay bonuses to all employees?
2. Who is eligible to receive a bonus?
3. What are the minimum and maximum percentages for bonuses?
4. Please let me guide you through the entire calculation process.
Feel free to provide more details or ask any specific questions you may have.
Regards,
Karthik P
From India, Thrissur
Acknowledge(0)Amend(0)
Dear employee,
An employee whose basic wages are up to Rs. 10,000/- is eligible to receive a bonus. A minimum of 30 days of service is required to qualify for the bonus. The minimum bonus amount is 8.33%, and the maximum is 20% of the basic salary, determined based on the allocable surplus.
The calculation of the bonus is done on Rs. 3,500/-
Thank you,
J.S. Malik
From India, Delhi
Acknowledge(0)Amend(0)
An employee whose basic wages are up to Rs. 10,000/- is eligible to receive a bonus. A minimum of 30 days of service is required to qualify for the bonus. The minimum bonus amount is 8.33%, and the maximum is 20% of the basic salary, determined based on the allocable surplus.
The calculation of the bonus is done on Rs. 3,500/-
Thank you,
J.S. Malik
From India, Delhi
Acknowledge(0)Amend(0)
I agree with Malik, but the calculation is done on 3500. Employees who have more than 3500 basic wage (3501 - 10000) are calculated based on actual basic wage. Employees with a basic wage exceeding 10001 are not eligible for a bonus.
From India, Visakhapatnam
Acknowledge(0)Amend(0)
From India, Visakhapatnam
Acknowledge(0)Amend(0)
Dear Karthik, I have something which would help u. Good Luck!! Regards Vipin
From India, New Delhi
Acknowledge(0)Amend(0)
From India, New Delhi
Acknowledge(0)Amend(0)
Sir, Can any one help me in giving an format of bonus calculation For Examlple if the basic + DA is 3500, 4000, 6000, to 10000, its an example. Please Help me Regards, KarthiK
From India, Thrissur
Acknowledge(0)Amend(0)
From India, Thrissur
Acknowledge(0)Amend(0)
Hi Karthi,
Here are the points on payment and coverage of bonus under the act:
1. Coverage: Any employee who draws a salary/wage (Basic+DA) less than Rs. 10000/- per month will now, due to this amendment, be covered as an employee under the Payment of Bonus Act 1965. (In the past, this limit was Rs. 3500/- per month (Basic+DA).
2. The percentage of bonus is a derived percentage from the method prescribed under the act (of calculating Gross Profit, Available Surplus, and the Allocable Surplus, and then the percentage of Bonus that can be paid).
3. The law stipulates that even when the company makes a loss, it is obliged to pay a bonus of 8.33%, and whatever the profits the company cannot pay a bonus exceeding 20%. The first is called the Statutory Minimum Bonus, and the other is called the statutory Maximum Bonus. Subject to other provisions of the act, the percentage of bonus varies between these two levels.
4. The rule is that the calculated bonus is to be paid on the actual salary/wage (Basic+DA) up to (now) Rs. 3500/- (In the past, this limit was Rs. 2500/-), and the maximum salary/wage (Basic+DA) on which a bonus can be paid is Rs. 3500/- (In the past, this limit was Rs. 2500/-).
5. Therefore, if the calculated bonus was 20%, then in the past, an employee drawing a salary/wage between Rs. 2500/- and Rs. 3500/- per month would get Rs. 6000/- as a Bonus (i.e., 2500*12*20%) and now he would get Rs. 8400/- under the same conditions (i.e., 3500*12*20%).
6. A suitable provision shall be made in the books of accounts as of 31st March every year and get it paid within a period of 9 months from the closure of the relevant financial year.
Regards,
Anurag Jain
From India, Jaipur
Acknowledge(0)Amend(0)
Here are the points on payment and coverage of bonus under the act:
1. Coverage: Any employee who draws a salary/wage (Basic+DA) less than Rs. 10000/- per month will now, due to this amendment, be covered as an employee under the Payment of Bonus Act 1965. (In the past, this limit was Rs. 3500/- per month (Basic+DA).
2. The percentage of bonus is a derived percentage from the method prescribed under the act (of calculating Gross Profit, Available Surplus, and the Allocable Surplus, and then the percentage of Bonus that can be paid).
3. The law stipulates that even when the company makes a loss, it is obliged to pay a bonus of 8.33%, and whatever the profits the company cannot pay a bonus exceeding 20%. The first is called the Statutory Minimum Bonus, and the other is called the statutory Maximum Bonus. Subject to other provisions of the act, the percentage of bonus varies between these two levels.
4. The rule is that the calculated bonus is to be paid on the actual salary/wage (Basic+DA) up to (now) Rs. 3500/- (In the past, this limit was Rs. 2500/-), and the maximum salary/wage (Basic+DA) on which a bonus can be paid is Rs. 3500/- (In the past, this limit was Rs. 2500/-).
5. Therefore, if the calculated bonus was 20%, then in the past, an employee drawing a salary/wage between Rs. 2500/- and Rs. 3500/- per month would get Rs. 6000/- as a Bonus (i.e., 2500*12*20%) and now he would get Rs. 8400/- under the same conditions (i.e., 3500*12*20%).
6. A suitable provision shall be made in the books of accounts as of 31st March every year and get it paid within a period of 9 months from the closure of the relevant financial year.
Regards,
Anurag Jain
From India, Jaipur
Acknowledge(0)Amend(0)
Hi When it will be applicable, can you let us know detailed idea about the Bonus Cheers Venkat
From India, Noida
Acknowledge(0)Amend(0)
From India, Noida
Acknowledge(0)Amend(0)
Hi All,
I have few more queries about payment of Bonus:
From India, Mumbai
Acknowledge(0)Amend(0)
I have few more queries about payment of Bonus:
- Penalty of non payment of bonus is 6months imprisonment or fine up to 1000 as per the Act….is it the updated one?
- Which department is responsible for maintaining register or record for available or allocable surplus? Is it HR or Accounts?
- Is it acceptable if a company pays 8.33% of 3500 to employees who’s basic is less than 10,000 without maintaining any register or record for available or allocable surplus?
- Which Gov. Dept. can enquire for payment of Bonus? …Shops & Establishment Inspector? or Sales Tax Officer?
From India, Mumbai
Acknowledge(0)Amend(0)
I have a little bit of confusion in the calculation of the bonus. I agree that we take 3500/- as per the calculation, but if a person is drawing a salary like 6000/-, how should we calculate, taking 6000/- or 3500/- as standard?
Gaurav
From India, Mumbai
Acknowledge(0)Amend(0)
Gaurav
From India, Mumbai
Acknowledge(0)Amend(0)
Superb clarity in the postings of Anurag Jain and very good attachment by Vipin Manav. Karthik may read the Payment of Bonus Act and look into any worked-out problems. It's very easy to understand rather than asking through emails and postings.
Gopan
From India, Kochi
Acknowledge(0)Amend(0)
Gopan
From India, Kochi
Acknowledge(0)Amend(0)
Yes, thanks for the information. Still, I need to clarify that there are people with different categories of Basic + DA, such as 3500, 6000, 8000. Should we use 3500 for all calculations, or do we need to consider 6000, 8000, as per Basic + DA? Could someone please clarify this for me?
Regards,
Karthik
From India, Thrissur
Acknowledge(0)Amend(0)
Regards,
Karthik
From India, Thrissur
Acknowledge(0)Amend(0)Looking for something specific? - Join & Be Part Of Our Community and get connected with the right people who can help. Our AI-powered platform provides real-time fact-checking, peer-reviewed insights, and a vast historical knowledge base to support your search.
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