Bonus Calculator

Calculate the statutory bonus under the Payment of Bonus Act, 1965, or estimate a performance bonus after tax.

What is the Bonus Calculator?

The Payment of Bonus Act requires eligible establishments to pay a bonus of 8.33% to 20% of wages to employees earning up to ₹21,000 a month. Performance bonuses are discretionary and set by the employer.

How does it work?

Statutory bonus is calculated on actual wages, capped at ₹7,000 a month or the scheduled minimum wage, whichever is higher, for the months worked. Performance bonus is a percentage of CTC, taxed at your marginal rate plus cess.

Formula

Statutory bonus = min(Wage, max(7,000, Minimum wage)) × Months × Rate

Example

An employee on ₹15,000 a month for 12 months at 8.33% gets 7,000 × 12 × 8.33% = ₹6,997.

Frequently asked questions

Is bonus taxable?

Yes, all bonuses are part of salary income and taxed at your slab rate.

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