Here i have a small query regarding , Gross components calculation in CTC ..
Can we give bonus in gross component including every month pay calculation like 100% (Basic+HRA+Coveyance+bonus+spl allowance)...not to add in CTC Structure.. Kinldy reply me on the same..
From India, undefined
2Can we give bonus in gross component including every month pay calculation like 100% (Basic+HRA+Coveyance+bonus+spl allowance)...not to add in CTC Structure.. Kinldy reply me on the same..
From India, undefined
If you are paying monthly fixed Bonus in lieu of profit sharing bonus payable under Payment of Bonus Act, then this components can form part of Cost to the Company(CTC), along with Basic, HRA, Conyeyance, Special allownace, and PF & ESI / insurance premium if applicable (the Management Contribution part).
From India, Madras
From India, Madras
Dear Colleague,
If your question is whether to include bonus component as part of CTC , then the answer is yes.
But if you want to pay bonus on monthly basis, then it poses challenges. Bonus under the Bonus Act is to be computed in accordance with the formula given , quantum and eligibility to bonus and to be paid within 8 months from the close of the financial year.
The minimum quantum of bonus is 8.33% and the maximum is 20% of annual wages earned subject to ceiling.
If any bonus paid on monthly basis before the financial year is yet not closed has to be on the basis of assumption and would perhaps has to be treated as an advance against the final bonus. This may pose otherwise avoidable practical difficulties.
The question is why this choice of paying bonus on monthly basis bypassing legal provisions is necessary to be made on some assumption.
In my view, it would be prudent to follow legal provisions under the Bonus Act rather than invent difficulties for oneself.
Regards,
Vinayak Nagarkar
HR- Consultant
From India, Mumbai
If your question is whether to include bonus component as part of CTC , then the answer is yes.
But if you want to pay bonus on monthly basis, then it poses challenges. Bonus under the Bonus Act is to be computed in accordance with the formula given , quantum and eligibility to bonus and to be paid within 8 months from the close of the financial year.
The minimum quantum of bonus is 8.33% and the maximum is 20% of annual wages earned subject to ceiling.
If any bonus paid on monthly basis before the financial year is yet not closed has to be on the basis of assumption and would perhaps has to be treated as an advance against the final bonus. This may pose otherwise avoidable practical difficulties.
The question is why this choice of paying bonus on monthly basis bypassing legal provisions is necessary to be made on some assumption.
In my view, it would be prudent to follow legal provisions under the Bonus Act rather than invent difficulties for oneself.
Regards,
Vinayak Nagarkar
HR- Consultant
From India, Mumbai
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Amendment to Payment of Bonus Act 2015.jpg
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Bonus-amendment _206.doc