Bonus Act
Payment of Bonus Act Compliance
Ensure accurate statutory bonus calculation, timely disbursement, and full compliance to foster employee goodwill and avoid disputes.
Introduction and Value Proposition
The Payment of Bonus Act, 1965, mandates eligible establishments to pay an annual bonus to their employees based on profits or productivity. The calculation of allocable surplus, understanding eligibility, and adhering to payment timelines is a complex, annual challenge. Errors can lead to employee disputes, penalties, and damage to morale. PCS provides end-to-end Bonus Act advisory services, ensuring accurate calculation, seamless processing, and 100% compliance, turning a regulatory obligation into an opportunity for employee engagement.
Why Choose PCS?
● Financial & Legal Acumen: Our experts combine knowledge of law and accounting for precise bonus calculations.
● Error-Free Guarantee: We ensure calculations are accurate, protecting you from financial losses and legal challenges.
● Proactive Approach: We initiate the process well in advance, ensuring you never miss the critical payment deadline.
Key Challenges We Solve
● Complex Calculations: Difficulty in accurately calculating allocable surplus, available surplus, and set-on/set-off.
● Eligibility Confusion: Uncertainty regarding which employees are eligible and which establishments are covered.
● Dispute Risk: Potential for employee disputes and legal claims due to incorrect bonus calculation or payment.
● Statutory Deadlines: Risk of missing the strict 8-month deadline for bonus payment after the accounting year closes.
Our Bonus Act Services
Frequently asked questions:
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Is my company required to pay statutory bonus?
The Act applies to every factory and establishment employing 20 or more persons on any day during an accounting year.
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What is the minimum and maximum bonus payable?
The minimum bonus is 8.33% of salary, and the maximum is 20%, subject to the calculation of available surplus.
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What is the deadline for paying the annual bonus?
The bonus must be paid within 8 months from the close of the accounting year (e.g., by November 1st for a March 31st year-end).
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