Bonus Calculator
Statutory bonus under bonus law, and tax on it.
Optional
Bonus is calculated on the higher of ₹7,000 or this.
Minimum 8.33%, maximum 20% of wages.
At least 30 working days are needed.
Your result
—
Enter your numbers to see the result.
This bonus calculator works out the statutory bonus employees are entitled to under Indian bonus law: between 8.33% and 20% of wages, calculated on the higher of ₹7,000 a month or the minimum wage, for employees earning up to ₹21,000 a month. Enter your wages, the bonus rate and months worked; it also estimates the tax on the bonus.
What is a Bonus Calculator?
Statutory bonus is the annual bonus employers must pay under bonus law, originally the Payment of Bonus Act, 1965, now part of the Code on Wages, 2019. It covers employees earning up to ₹21,000 a month in establishments with 20 or more workers, who have worked at least 30 days in the year.
The bonus is at least 8.33% and at most 20% of wages, calculated on a wage ceiling: the higher of ₹7,000 a month or the minimum wage for the job. Many companies pay it around Diwali. This bonus calculator works out the amount and the tax on it.
How does the Bonus Calculator work?
The calculator checks eligibility, then takes the lower of your actual wages and the ceiling (the higher of ₹7,000 or the minimum wage). It multiplies this by months worked and the bonus rate.
Bonus is taxable as salary, so it also estimates tax at your slab plus 4% cess.
How to use the Bonus Calculator step by step
- Enter your monthly wages (basic plus DA).
- Enter the minimum wage for your job if known.
- Enter the bonus rate.
- Enter months and days worked.
- Choose your tax slab.
- Read the bonus and the amount after tax.
Bonus Calculator example with real numbers
You earn ₹18,000 a month in basic plus DA at a factory where the minimum wage is ₹12,000, and you worked all year. The company pays the minimum 8.33% bonus.
| Example input | Value |
|---|---|
| Monthly wages (basic + DA) | ₹18,000 |
| Monthly minimum wage for your job (optional) | ₹12,000 |
| Bonus rate | 8.33% |
| Months worked in the year | 12 |
| Working days in the year | 240 |
| Your tax slab | 0% (income under tax limit) |
| Example output | Value |
|---|---|
| Bonus for the year | ₹11,995 |
| Wage used for bonus | ₹12,000 a month |
| Months counted | 12 |
| Minimum bonus (8.33%) | ₹11,995 |
| Maximum bonus (20%) | ₹28,800 |
| Approx. tax on bonus | ₹0 |
| Bonus after tax | ₹11,995 |
Bonus is calculated on the higher of ₹7,000 and the minimum wage, so on ₹12,000. The bonus calculator gives ₹11,995 for the year. At 20%, the maximum, it would be ₹28,800.
Key features of this Bonus Calculator
- Eligibility checks (₹21,000 and 30 days)
- Wage ceiling logic
- 8.33% minimum and 20% maximum
- Months worked
- Tax estimate
Who should use the Bonus Calculator?
Who is this Bonus Calculator for?
- Factory and shop employees
- HR and payroll staff
- Small business owners
- Labour law students
Practical use cases
- Checking Diwali bonus
- Calculating bonus for part-year employees
- Budgeting bonus costs
- Explaining bonus to staff
Key benefits
- Correct base: ceiling applied.
- Clear range: minimum to maximum.
- Tax-aware: after-tax bonus.
- Simple: few inputs.
Tips for better results
- Check your state’s current minimum wage for your job category.
- Bonus must usually be paid within 8 months of the end of the accounting year.
- New establishments may have exemptions for early years.
- Keep bonus registers for compliance.
Common mistakes to avoid
- Calculating bonus on full salary instead of the ceiling.
- Ignoring employees earning just under ₹21,000.
- Forgetting part-year employees.
- Treating performance bonus as statutory bonus.
Limitations of this Bonus Calculator
- Ceilings may be revised under the Code on Wages rules.
- Allocable surplus calculations for higher bonus are not modelled.
- Tax estimate assumes your slab.
Bonus Calculator vs other ways to calculate
| Item | Rule |
|---|---|
| Eligibility | Wages up to ₹21,000 a month, 30+ days worked |
| Minimum bonus | 8.33% of wages |
| Maximum bonus | 20% of wages |
| Calculation ceiling | Higher of ₹7,000 or minimum wage |
For in-hand pay, use the in hand salary calculator. For gratuity, see the gratuity calculator.
Privacy and data handling
This Bonus Calculator runs entirely in your browser. The numbers you type are not sent to Qorico or stored on any server, and nothing is saved after you close the page. The Copy and Download buttons create the result on your own device. If the page has analytics turned on, it may count that a calculation happened, but it does not record the values you entered.
Bonus Calculator FAQs
How is statutory bonus calculated?
Bonus = wage ceiling × months worked × bonus rate, where the ceiling is the higher of ₹7,000 or the minimum wage, capped at your actual wages.
Who is eligible for statutory bonus?
Employees earning up to ₹21,000 a month who worked at least 30 days in the year, in covered establishments.
What is the minimum bonus?
8.33% of wages, even if the company makes no profit, subject to the law’s conditions.
Is bonus taxable?
Yes, bonus is taxable as salary at your slab rate.
When is bonus paid?
Usually within 8 months after the end of the accounting year; many employers pay at Diwali.
Does the new labour code change bonus?
Bonus provisions now sit in the Code on Wages, 2019, with similar rules; check notified ceilings.
Related tools
Sources and references
We checked the method and the current figures used in this Bonus Calculator against these official and primary sources:
- Ministry of Labour and Employment: Payment of Bonus
- India Code: Code on Wages, 2019
- Income Tax Department of India
Written and reviewed by the Qorico Team
