Work out the statutory bonus due under the Payment of Bonus Act, 1965, from your monthly Basic plus Dearness Allowance, or break an annual performance bonus down into its monthly equivalent and its per payout value. Both modes show the arithmetic rather than a single figure. If you want the bonus decoded inside a full package, start with the CTC to in-hand salary calculator, and for what the bonus costs you in tax use the income tax calculator. Nothing you type leaves your browser.
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This bonus calculator does two separate jobs, because the word bonus covers two separate things in an Indian pay packet. The statutory mode computes what the Payment of Bonus Act, 1965 actually entitles you to: it tests your monthly Basic plus Dearness Allowance against the ₹21,000 eligibility ceiling, applies the Section 12 wage cap of ₹7,000 or the notified minimum wage, and works the bonus out at any rate between the 8.33% statutory minimum and the 20% maximum. The annual mode takes a performance, joining or festival bonus and breaks it into its monthly equivalent, its value at each payout, and its share of your total package.
What the tool deliberately does not do is tell you the tax. A bonus is fully taxable as salary income with no exemption of any kind, but the amount it costs you depends on the rest of your year's income, not on the bonus alone, so a tax figure printed here would be a guess wearing a confident voice. Carry the number to the income tax calculator instead, or check whether the extra income changes your regime on the old versus new tax regime calculator. If you are trying to work out where a bonus sits inside an offer, the CTC to in-hand salary calculator separates the fixed and variable halves of a package, and the whole set sits inside the salary calculators for India.
Pick the mode that matches the bonus you are holding, type the figures, and the full working appears without a page reload.
Jump back to the bonus calculator and run your own figures, or see how the bonus lands in your monthly pay on the in-hand salary calculator.
A full accounting year of twelve months, no minimum wage notification entered, so the Section 12 figure is the ₹7,000 statutory floor. Every number below was produced by the calculator on this page, not typed from a reference chart.
| Step | ₹6,000 Basic + DA | ₹15,000 Basic + DA | ₹15,000 at 20% |
|---|---|---|---|
| Monthly Basic plus DA | 6,000 | 15,000 | 15,000 |
| Covered by the Act, Section 2(13) | Yes | Yes | Yes |
| Section 12 wage ceiling | 7,000 | 7,000 | 7,000 |
| Calculation wage used | 6,000 | 7,000 | 7,000 |
| Months worked | 12 | 12 | 12 |
| Wage earned for bonus purposes | 72,000 | 84,000 | 84,000 |
| Bonus rate applied | 8.33% | 8.33% | 20% |
| Minimum bonus at 8.33%, Section 10 | 5,998 | 6,997 | 6,997 |
| Maximum bonus at 20%, Section 11 | 14,400 | 16,800 | 16,800 |
| Annual statutory bonus payable | 5,998 | 6,997 | 16,800 |
| Monthly equivalent | 500 | 583 | 1,400 |
Two things in that table surprise people. The first is that the ₹6,000 earner and the ₹15,000 earner receive almost the same bonus at the same rate, ₹5,998 against ₹6,997, even though one is paid two and a half times the other. That is Section 12 doing its work: above ₹7,000 a month the bonus is computed as if the wage were ₹7,000, so it stops tracking your actual salary entirely. The second is how much the declared rate matters. The same ₹15,000 wage produces ₹6,997 at the statutory minimum and ₹16,800 at the maximum, a difference of ₹9,803 decided by the employer's allocable surplus rather than by anything you can negotiate. A part year is scaled the same way: nine months at ₹15,000 Basic plus DA gives ₹5,248 rather than ₹6,997, and three months gives ₹1,749. If your Basic plus DA is above ₹21,000, none of this applies to you and your bonus is contractual, which is what the annual mode is for. To see what these wage figures look like as a whole payslip, run them through the in-hand salary calculator, and to see how Basic itself is set inside a package use the salary breakup calculator.
A bonus calculator has to answer two different questions, and most tools only answer the easier one. The easy question is arithmetic: an annual bonus of ₹3,00,000 is ₹25,000 a month in equivalent terms and ₹75,000 a quarter if it is paid quarterly. The hard question is legal: given a monthly Basic plus Dearness Allowance, what does the Payment of Bonus Act, 1965 actually require an employer to pay, and does the Act even apply to this person. This page answers both, in two modes, and keeps them separate because mixing them is what makes bonus advice confusing.
The distinction matters more than it sounds. Statutory bonus is a legal entitlement with a floor: an eligible employee gets at least 8.33% of the wage earned in the accounting year even in a year the employer made no profit at all. A performance bonus has no floor. It can be reduced, deferred or paid at zero, because it rests on a company policy rather than on a statute. Two people can both say they get a bonus and be describing entirely different levels of certainty.
Where the tool stops is income tax, and that is a deliberate boundary rather than a gap. Every rupee of bonus, statutory or contractual, is taxable as salary income, but what it costs depends on your total income for the year and the regime you are on. That calculation belongs to the income tax calculator and the old versus new tax regime calculator, and for the year's net position after tax the post-tax salary calculator is the right page.
Indian compensation uses one word for four arrangements with different triggers, different certainty and different negotiating room. Knowing which one you are holding decides which mode of this calculator you should be in.
The practical test is your Basic plus Dearness Allowance. At or below ₹21,000 a month you have a statutory entitlement whatever else your employer chooses to add. Above it you have whatever your contract says and nothing more, which is why senior offers are worth reading for the clawback and the target definition rather than the headline number. If you are unsure what your Basic actually is, the salary breakup calculator reconstructs it from a package figure.
The Act applies to every factory and to every other establishment employing twenty or more people on any day during an accounting year. Once it applies, four provisions decide the number, and this calculator applies them in order.
Section 2(13) sets who counts as an employee: a person whose salary or wage does not exceed ₹21,000 a month. Section 2(21) defines that salary or wage as basic pay plus dearness allowance, which is why house rent allowance, conveyance, overtime and every other allowance are excluded from the input on this page. Section 8 adds the service test, thirty working days in the accounting year, which is a low bar and catches most mid-year joiners.
Section 12 is the provision that surprises people. Where the wage exceeds ₹7,000 a month or the minimum wage notified for that scheduled employment, whichever is higher, the bonus is computed as if the wage were that capped figure. So an employee on ₹15,000 of Basic plus DA and an employee on ₹7,000 receive an identical statutory bonus, because both are computed on ₹7,000. The minimum wage half of that sentence is frequently dropped, and dropping it understates the bonus in states where the notified minimum wage for the employment exceeds ₹7,000, which is why this calculator gives it a field of its own.
Sections 10 and 11 then set the band. The minimum bonus is 8.33% of the wage earned in the accounting year, or ₹100, whichever is higher, and it is payable whether or not the employer has an allocable surplus. The maximum is 20%, payable where the surplus supports it. On the ₹7,000 ceiling and a full twelve months the band therefore runs from ₹6,997 at the minimum to ₹16,800 at the maximum. Section 19 requires payment within eight months of the close of the accounting year, which for an April to March employer means by the end of November. Because the bonus is taxable as salary in the year you receive it, the Income Tax Department's guidance on reporting salary income in ITR-1 is worth reading before you file the year a large bonus lands.
A full accounting year of twelve months, no minimum wage notification, so the Section 12 figure is the ₹7,000 floor. Every row was computed by the engine on this page rather than typed from a chart, so the table and the tool cannot drift apart.
| Monthly Basic + DA | Calculation Wage | Bonus at 8.33% | Bonus at 20% | Monthly Equivalent at 8.33% |
|---|---|---|---|---|
| ₹3,000 | 3,000 | 2,999 | 7,200 | 250 |
| ₹5,000 | 5,000 | 4,998 | 12,000 | 417 |
| ₹7,000 | 7,000 | 6,997 | 16,800 | 583 |
| ₹10,000 | 7,000 | 6,997 | 16,800 | 583 |
| ₹15,000 | 7,000 | 6,997 | 16,800 | 583 |
| ₹21,000 | 7,000 | 6,997 | 16,800 | 583 |
The bottom four rows are identical on purpose. Once Basic plus DA passes ₹7,000 the calculation wage is frozen there, so the bonus stops rising even as the salary triples. At ₹21,001 the Act stops applying altogether and no statutory bonus is due at all. Where a state has notified a minimum wage above ₹7,000 for the employment, that higher figure replaces ₹7,000 and every number in this table rises with it.
The monthly equivalent is the annual bonus divided by twelve. It is not a payout schedule and no employer pays a performance bonus that way. What it is good for is comparison: when one offer states a bonus annually and another folds a smaller amount into the monthly credit, the only way to compare them is to put both on the same footing.
| Annual Bonus | Monthly Equivalent | Paid Half-Yearly | Paid Quarterly |
|---|---|---|---|
| ₹10,000 | 833 | 5,000 | 2,500 |
| ₹25,000 | 2,083 | 12,500 | 6,250 |
| ₹50,000 | 4,167 | 25,000 | 12,500 |
| ₹1,00,000 | 8,333 | 50,000 | 25,000 |
| ₹2,00,000 | 16,667 | 1,00,000 | 50,000 |
| ₹5,00,000 | 41,667 | 2,50,000 | 1,25,000 |
The second thing the annual mode returns is the variable share, and it is the number that should decide an offer. A package of ₹15,00,000 built from ₹12,00,000 fixed and a ₹3,00,000 bonus is 20% variable. The same headline built from ₹14,00,000 fixed and a ₹6,00,000 bonus, giving ₹20,00,000, is 30% variable, and the extra ₹5,00,000 is money you only see if targets are met. Compare the fixed columns first and the totals second. For the monthly credit that fixed pay actually produces, use the take-home salary calculator or the monthly salary calculator, and if you are weighing a raise against a bonus the salary increment calculator puts both in percentage terms.
Use the statutory mode when the question is about entitlement: a factory or shop worker checking whether the Diwali payment matched the law, a payroll assistant computing bonus across a workforce paid at or under ₹21,000, a mid-year joiner working out the proportionate share, or anyone whose employer has declared a rate above the minimum and who wants to see what that rate is worth.
Use the annual mode when the question is about a package: comparing two offers with different variable structures, budgeting around a bonus that lands once a year, converting a quarterly incentive into an annual figure, or deciding whether a joining bonus with a clawback is worth the lock-in. The mode you want is the one that matches where your number came from, a statute or a contract.
Neither mode is the right tool for monthly budgeting. A bonus is lumpy by nature and your employer will usually deduct extra tax in the month it is paid, so the credit that month looks nothing like the average. Budget from your payslip or the in-hand salary calculator, and keep the bonus figures for annual planning. Other one-time statutory payments work the same way and have their own pages: the gratuity calculator for service payouts and the leave encashment calculator for unused leave.
The short version, before the detail: this is a statutory calculator built on the text of the Payment of Bonus Act plus a plain arithmetic breakdown for contractual bonuses. It is not a payroll system, it does not know your employer's allocable surplus, and it does not compute income tax. Where it assumes something or stops short, it says so here.
Every bonus is fully taxable as salary income and no exemption exists for any type. What it costs you depends on your total income for the year, your regime and your other deductions, none of which this page asks for. Returning a tax figure from the bonus alone would be a number the page could not stand behind, so it is not printed. Take the bonus to the income tax calculator and add it to your other income there, or see the annual net position on the post-tax salary calculator.
Between 8.33% and 20% the actual rate depends on the allocable surplus computed from the employer's gross profits, along with the set on and set off provisions that carry surplus between years. That calculation needs the company's accounts, not your payslip. The tool therefore takes the rate as an input and shows the whole band, so you can see what the minimum and the maximum are worth before you ask what rate has been declared.
The Act computes bonus on the salary or wage earned during the accounting year, and reduces it proportionately for days not worked. This tool asks for whole months, which is accurate for a clean part year such as a mid-year joiner or leaver. If you had unpaid absence scattered through the year, your employer will compute on the exact days and the figure here will be slightly high. Eligibility itself needs only thirty working days under Section 8.
Section 10 sets the minimum bonus at 8.33% of the wage earned or ₹100, whichever is higher, and the calculator applies that floor. There is a lower figure of ₹60 in the Act for an employee who has not completed fifteen years of age at the beginning of the accounting year. That case is rare enough, and specific enough, that the tool does not model it: if it applies, the floor is ₹60 rather than ₹100 and everything else in the calculation is unchanged.
The Act disqualifies an employee dismissed for fraud, for riotous or violent behaviour on the premises, or for theft, misappropriation or sabotage of the employer's property. It also exempts certain classes of establishment. Neither is something a calculator can test from a wage figure, so the tool answers the arithmetic question and assumes coverage and entitlement. If either is in doubt, the establishment's own bonus register is the document that settles it.
Bonus figures are rounded to whole rupees once, at the end of the calculation, and the monthly equivalent is the annual figure divided by twelve. Nothing here is legal or tax advice. Employment law changes, minimum wage notifications are revised by state governments, and a specific dispute about a bonus is a matter for your employer's records and, if it comes to it, a labour authority rather than a web page.
The people this page helps most are the ones on either side of the ₹21,000 line, and they need opposite things from it. Below the line, a shop floor employee or a payroll assistant needs the statutory arithmetic done properly, including the Section 12 minimum wage clause that most quick calculators ignore, so that a Diwali payment can be checked against what the law actually requires. Above the line, a software engineer or a manager needs the annual mode, because no statutory bonus is due at all and the only question left is what share of the package is variable and how much of it survives targets. A mid-year joiner sits in between and usually wants the proportionate figure. An employer covered by the Act wants the band, the minimum they owe regardless of profit and the maximum they may declare. If your next question is what the bonus does to your monthly credit rather than your annual entitlement, the take-home salary calculator and the annual salary calculator are the right stops, people paid by the hour should start at the hourly to salary converter, contractors and consultants belong on the freelance income calculator where no bonus statute applies at all, and interns on a stipend should read the internship stipend calculator instead. Everything sits inside the wider set of salary calculators for India.
Statutory bonus is a legal entitlement created by the Payment of Bonus Act, 1965. It applies to every factory and to every other establishment employing twenty or more people. You are eligible if your monthly salary or wage, meaning basic pay plus dearness allowance, is ₹21,000 or less, and if you have worked at least thirty working days in the accounting year. Above ₹21,000 the Act stops applying and any bonus you receive is contractual rather than statutory.
Four provisions decide it. Section 2(21) fixes the wage as basic plus dearness allowance only. Section 12 caps the calculation wage at ₹7,000 a month or the notified minimum wage for that scheduled employment, whichever is higher. That capped wage is multiplied by the months worked to give the wage earned, and the bonus rate is applied to it. On a full year at the ₹7,000 ceiling that produces ₹6,997 at the 8.33% minimum and ₹16,800 at the 20% maximum.
The Act sets a band, not a single figure. Section 10 makes 8.33% the minimum, payable whether or not the employer made a profit that year. Section 11 sets 20% as the maximum. Where the rate lands between those two depends on the allocable surplus computed from the employer’s gross profits, including surplus carried between years. That is a company accounts question, so the calculator on this page takes the rate as an input and shows you what the whole band is worth.
Because of Section 12. Once your basic plus dearness allowance passes ₹7,000 a month, the bonus is computed as if your wage were ₹7,000, or the notified minimum wage if that is higher. Someone on ₹15,000 of basic plus DA therefore receives exactly the same statutory bonus as someone on ₹7,000. The cap is why the statutory figure stops tracking your salary, and why senior employees rely on contractual bonuses instead.
Many employers do pay it monthly, often shown on the payslip as advance bonus or statutory bonus. That is a timing arrangement, not a different entitlement: the annual figure the Act requires is unchanged, and Section 19 still sets the outer deadline of eight months from the close of the accounting year. If your employer pays it monthly, the monthly equivalent this calculator returns is what should be appearing on each payslip.
Where the employer is covered by the Act and you earn ₹21,000 or less in basic plus DA, the Diwali payment is usually just the statutory bonus paid at festival time, so it is compulsory and it is computed exactly as described above. Where the Act does not apply, a Diwali bonus is ex-gratia, meaning voluntary, and the employer decides the amount or pays nothing. The timing is common because the statutory deadline falls near the festival season.
It is the annual bonus divided by twelve. An annual bonus of ₹60,000 gives a monthly equivalent of ₹5,000, and ₹3,00,000 gives ₹25,000. The figure exists for comparison, not as a payout schedule: it lets you weigh an offer that quotes a bonus annually against one that folds a smaller amount into the monthly credit. Most bonuses are actually paid annually, half-yearly or quarterly, and the calculator shows that per payout figure separately.
Yes. The Payment of Bonus Act figures this page uses are the ones in force for FY 2026-27: the ₹21,000 eligibility ceiling, the ₹7,000 calculation wage floor under Section 12, the 8.33% minimum and the 20% maximum. Those figures were set by the 2015 amendment and have not moved since, so unlike income tax slabs they are not revisited at each Budget. The tax treatment of a bonus, however, follows the current financial year’s slabs.
Yes, and there is no exemption for any type. Statutory, performance, joining and festival bonuses are all taxed as salary income at your applicable slab rate. Your employer deducts tax on the combined figure, so a large bonus often produces a sharp jump in the deduction that month, which settles when you file. This calculator does not compute that tax, because it depends on your whole year of income rather than on the bonus alone.
Usually yes. Most private sector offers fold variable pay or performance bonus into the headline CTC figure, which makes the package look larger than the amount you are certain to receive. Unlike fixed salary, that component depends on individual or company performance and can be paid in part or not at all. When you compare two offers, compare the fixed components first and the totals second.
A clawback clause requires you to repay a joining bonus, in full or pro rata, if you leave before a stated period. It converts what looks like a payment into a conditional one, so read the exact trigger and the period before you accept. Tax was already deducted when the bonus was paid, so repaying it later can leave you out of pocket on the tax as well as the principal. Treat it as a lock-in with a price, not as free money.
Statutory entitlement from your Basic plus DA, or an annual bonus broken into its monthly equivalent and its variable share. Free, private, and nothing you type is stored.
🎯 Calculate My BonusNext question is usually the tax, so continue to the income tax calculator. To see the bonus inside a full package use the CTC to in-hand salary calculator, check what your provident fund is building on the provident fund calculator, look up your state deduction on the professional tax calculator, or browse all of the salary calculators for India.