Statutory Bonus Calculator

A statutory bonus calculator works out the bonus payable under the Payment of Bonus Act, 1965 at a rate of 8.33% to 20%, using salary capped at ₹7,000 a month and pro-rated for months worked; employees earning over ₹21,000 a month are flagged as not covered.

The Payment of Bonus Act, 1965 entitles eligible employees to a statutory annual bonus, distinct from any discretionary performance bonus a company might additionally pay. It applies to employees earning up to ₹21,000 per month (basic plus dearness allowance) who have worked at least 30 days in the accounting year, in establishments employing 20 or more people. If your salary crosses that ceiling, this particular statutory entitlement doesn't apply to you — though your employer may still offer a bonus voluntarily.

The rate must fall between 8.33% (the statutory minimum, mathematically equal to one month's salary spread across the year) and 20% (the statutory maximum), depending on the company's profits under the Act's formula. The trickier part is the calculation ceiling: even if your actual salary is higher (up to the ₹21,000 eligibility limit), the bonus is calculated as though your salary were capped at ₹7,000 per month or the state minimum wage, whichever is higher — this calculator applies the simplified ₹7,000 cap; check your state's minimum wage notification if it exceeds that figure.

Bonus is payable within 8 months of the close of the accounting year. If you worked only part of the year, the months-worked field pro-rates the entitlement accordingly. This is a statutory floor, not a ceiling on generosity — many employers pay bonuses well above what the Act requires, and those additional amounts aren't governed by this specific calculation.