Under the Payment of Bonus Act, 1965, the rules for filing a Bonus Return are designed to ensure transparency and compliance in bonus payments for eligible employees. Here’s a breakdown of the primary aspects:
- Applicability: The act applies to establishments with 20 or more employees. Employers in sectors like factories, mines, and businesses are required to pay bonuses to employees earning up to a specified salary threshold.
- Percentage of Bonus: Eligible employees are entitled to a minimum bonus of 8.33% of their annual salary/wages. The maximum bonus can go up to 20%, depending on the company’s profitability.
- Bonus Payment Timeline: Bonus is to be paid within Eight months of closure of the financial year and the return is to be filed within 30 days after payment as prescribed in Section 19 of the Act.
- Filing of Bonus Return: Employers must file a Bonus Return in Form D within 30 days after the disbursement of the bonus. The return includes details about the calculation, distribution, and amount of bonus paid to employees.
- Who Pays: The employer is responsible for calculating and disbursing the bonus. They must keep records and submit these details to the appropriate government authority as part of compliance.
- Penalties for Non-Compliance: Failure to file the return or pay the due bonus may result in fines and legal repercussions under the act.
For further information, consider consulting your compliance advisor or visiting Sankhla Corporate Services, who specialize in labour law compliance services and can guide on bonus return filing and related legalities.