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Query on bonus

nayan (article assistant) (466 Points)

03 January 2013

my client has paid the bonus for thy year 2011-12 on november 2012. is there any time limit in which bonus payment is to be made? or it can be paid whenever management wants????

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Radheshyam Mishra (CA) (29 Points)
Replied 03 January 2013

Nayan,

There is the time limit for the payment of Bonus under Payment of Bonus Act

Time-limit for payment of bonus.-

1*[All amounts] payable to an employee by way of bonus under this Act shall be paid in cash by

his employer--

(a) where there is a dispute regarding payment of bonus

pending before any authority under section 22, within a

month from the date on which the award becomes

enforceable or the settlement comes into operation, in

respect of such dispute;

(b) in any other case, within a period of eight months from

the close of the accounting year:

Provided that the appropriate Government or such authority as the

appropriate Government may specify in this behalf may, upon an

application made to it by the employer and for sufficient reasons, by

order, extend the said period of eight months to such further period

or periods as it thinks fit; so, however, that the total period so

extended shall not in any case exceed two years.

may this will help you.

Thanks

nayan (article assistant) (466 Points)
Replied 03 January 2013

thank you. it means a lot for me.

Giridhar S Karandikar (Team Lead) (7543 Points)
Replied 03 January 2013

As per the PBA 1956 bonus is requried to be paid withing 8 months from teh end of the accounting year. as the bonus is being paid in nov12 so tehre's no default on part of teh employer.

However as per section 43B of teh I-T Act, the bonus paid would get disallowed as it is paid after the due date of furnishing teh retunr i.e 31st Jul or 30th Sept as teh case maybe. This can be however claimed in teh subsequent A.Y.

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