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Calculation of Bonus

Last post August 1, 2016 07:02 AM by raghu. 1 repiles.
August 1, 2016 07:00 AM 1
Total Posts: 39
Join Date: July 20, 2006
Rank: Executive
Post Date: August 1, 2016
Posts: 39
Location: Afghanistan

Calculation of Bonus

Dear community,

I want to understand how bonus amount is calculated. Can someone throw light and elaborate with an example.

Regards,

Danish 
August 1, 2016 07:022
raghu
Total Posts: 51
Join Date: July 20, 2006
Rank: Manager
Post Date: August 1, 2016
Points: 255
Location: Afghanistan

Re: Calculation of Bonus

Bonus to be paid under Payment of Bonus Act,1965 is to be calculated as under :
 
1. It depends upon the percentage on which your company wants to give bonus to its employees. Minimum bonus is 8.33% of basic salary earned during the accounting year and Maximum is 20% under the payment of Bonus Act,1965.
 
2. Eligibility : Bonus under Payment of Bonus Act,1965 is required to be to employees whose salary ( Basic) is of less than Rs. ____ per month during the accounting year for which bonus is to be paid.
 
3. Bonus is to be calculated for eligible employees assuming salary (Basic) as Rs. 2500.00 per month or less, if, it is less then Rs.2500.00
 

4.Multiply the yearly sum of salary thus worked out as per above clause 3 with rate of bonus. The figure is bonus payable to employee under the act. 
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