Dear seniors.
I have doubt regarding sec 16 of bonus
Act. Which state that newly setup companies
may be exempt from bonus payment.
My query is.. xyz pvt. Ltd was incorporated
in FY 2014-15 & incurred the loss hence
Company is not liable to pay bonus for this year. However in FY 2015-16 it has made the profit of 1767389/- pls let me know weather the company is liable to pay bonus for
FY 2015-16 or not.
Also clarify what actually the rule of exemption
upto 5 year for newly setup companies weather this exemption is available only in case of loss or in case of inadequate profit also if so? Is there any ceiling limit of profit in sec 16 that if the profit exceed this limit then
Companies has to pay bonus irrespective of five year.
Regds
Ashish Jain
From India, Jaipur
I have doubt regarding sec 16 of bonus
Act. Which state that newly setup companies
may be exempt from bonus payment.
My query is.. xyz pvt. Ltd was incorporated
in FY 2014-15 & incurred the loss hence
Company is not liable to pay bonus for this year. However in FY 2015-16 it has made the profit of 1767389/- pls let me know weather the company is liable to pay bonus for
FY 2015-16 or not.
Also clarify what actually the rule of exemption
upto 5 year for newly setup companies weather this exemption is available only in case of loss or in case of inadequate profit also if so? Is there any ceiling limit of profit in sec 16 that if the profit exceed this limit then
Companies has to pay bonus irrespective of five year.
Regds
Ashish Jain
From India, Jaipur
If the company made profit in any of the year then the bonus will be payable in that year.
From India, Delhi
11From India, Delhi
Dear sir. Does that means even if companies made the profit of Rs. 1 then shall be liable to pay Bonus to its employees
From India, Jaipur
From India, Jaipur
Dear Ashish Jain,
It is true that the Govt has given exemption to the newly set up establishhments but with provision that if an employer derives profit in between, such bonus shall be calculated as per First or Second Schedule, as the case may be, without applying formula of " Set on and set off of allocable surplus" given in Section 15 of the Act.
In reference to your query that if the employer has made the profit of 1767389/- during FY 2015-16 weather the company is liable to pay bonus, I wish to clarify that we cannot make an opinion based on the amount given by you rather it has to calculated as per formula explained above. Secondly, the calculations are based on Accounting year and not FY as mentioned by you.
BS Kalsi,
Member since August, 2011
From India, Mumbai
It is true that the Govt has given exemption to the newly set up establishhments but with provision that if an employer derives profit in between, such bonus shall be calculated as per First or Second Schedule, as the case may be, without applying formula of " Set on and set off of allocable surplus" given in Section 15 of the Act.
In reference to your query that if the employer has made the profit of 1767389/- during FY 2015-16 weather the company is liable to pay bonus, I wish to clarify that we cannot make an opinion based on the amount given by you rather it has to calculated as per formula explained above. Secondly, the calculations are based on Accounting year and not FY as mentioned by you.
BS Kalsi,
Member since August, 2011
From India, Mumbai
5 years exemption from not paying bonus for a newly started company is not clear in bonus act like whether it needs to pay or not eventhough the company gains profit or loss. I need an help with supporting documents on the above issue.
From India, Ahmedabad
From India, Ahmedabad
Dear Sh Murty,
In reference to your a query, I would request you to qo through Section 16(1A) of the Payment of Bonus Act, 1965, which, I am sure, will clear your doubt.It provides that during first five Accounting years, the employer shall be liable to pay bonus to his employees only for the Accounting year in which he derived profit from the newly set up establishment.
As far your demand for supporting documents is concerned nothing is above the legislation which is passed by the parliament.
BS Kalsi,
Member since August , 2011
From India, Mumbai
In reference to your a query, I would request you to qo through Section 16(1A) of the Payment of Bonus Act, 1965, which, I am sure, will clear your doubt.It provides that during first five Accounting years, the employer shall be liable to pay bonus to his employees only for the Accounting year in which he derived profit from the newly set up establishment.
As far your demand for supporting documents is concerned nothing is above the legislation which is passed by the parliament.
BS Kalsi,
Member since August , 2011
From India, Mumbai
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