Is 20% Bonus Optional for the Employer? Statutory Bonus Calculation Code on Wages 2019 #castudents

Is 20% bonus optional for the employer? How is statutory bonus actually calculated under the Code on Wages, 2019? In this video, we take our discussion on the Code on Wages, 2019 one step further and understand the complete statutory bonus calculation mechanism with practical numerical examples. In our previous video, we introduced the Code on Wages and discussed the basic concepts relating to minimum wages and statutory bonus. In this video, we build on that foundation and focus specifically on how statutory bonus is determined in practice. 🔹 WHAT WILL YOU LEARN IN THIS VIDEO? ✅ 8⅓% Minimum Bonus — Is it mandatory? ✅ 20% Maximum Bonus — Is it optional for the employer? ✅ ₹21,000 — Bonus eligibility ceiling ✅ ₹7,000 / applicable minimum wage — Calculation base ✅ Difference between actual wages, eligibility limit and bonus calculation base ✅ Gross Profit → Available Surplus → Allocable Surplus → Bonus ✅ 60% vs 67% — Banking Company vs Other Establishments ✅ Set-on and Set-off under Section 36 ✅ How Set-on is utilised in a bad year ✅ How Set-off is carried forward and absorbed in a subsequent year ✅ Four succeeding accounting years and expiry of Set-on/Set-off ✅ Difference between statutory bonus and additional/ex-gratia bonus ✅ Practical numerical illustrations ✅ 10-year case study covering different profit and bonus situations The objective is not just to memorise 8⅓% and 20%, but to understand how the statutory mechanism actually works from the company's surplus calculation to the final bonus payable to eligible employees. 📊 PRACTICAL BONUS CALCULATION The video explains the complete chain: Gross Profit ↓ Less: Statutory Deductions ↓ Available Surplus ↓ 60% / 67% ↓ Allocable Surplus ↓ Set-on / Set-off ↓ Statutory Bonus We also use a detailed 10-year practical illustration to understand how the mechanism works when the company has good years, bad years, surplus, deficiency, Set-on and Set-off. 🎓 WHO SHOULD WATCH THIS VIDEO? • CA Students • Chartered Accountants • Finance Professionals • HR Professionals • Payroll Professionals • Auditors • Accounts & Compliance Teams • Employers & Business Owners • Labour Law Professionals • Anyone interested in the Indian Labour Codes 🔗 CONTINUING THE LABOUR CODES SERIES This video is part of our broader Indian Labour Codes learning series. In the previous video, we discussed the basic framework of the Code on Wages, minimum wages and statutory bonus. In the upcoming videos, we will continue our journey through the other Labour Codes, including: 📌 Industrial Relations Code 📌 Code on Social Security 📌 Occupational Safety, Health and Working Conditions Code (OSHWC) The objective is to understand the Labour Codes practically, section by section, with examples and real-world implications, rather than simply reading the legislation. And the channel will continue to cover Tax, GST, Accounting, Labour Law and other important professional topics for CA students and professionals. 📢 SUBSCRIBE FOR FUTURE UPDATES If you find these practical CA, Tax, GST, Accounting and Labour Law explanations useful, please: 👍 Like the video 💬 Share your views/questions in the comments 🔔 Subscribe to CA Gangadhar Reddy B 📲 Turn on the notification bell for future videos. Stay connected for more practical and simplified professional-content videos. ⚖️ DISCLAIMER This video is intended for educational and awareness purposes only. The numerical examples are illustrative and use assumed figures for explaining the statutory mechanism. Actual bonus eligibility, calculation, Available Surplus, Allocable Surplus, Set-on/Set-off and other compliance requirements should be determined with reference to the Code on Wages, 2019, applicable Rules, notifications and other applicable laws in force on the relevant date. This content should not be treated as legal, tax, financial or professional advice. #CodeOnWages #StatutoryBonus #BonusCalculation #LabourCodes #LabourLaw #Payroll #HRCompliance #CAStudents #CharteredAccountant #FinanceProfessionals