Statutory Bonus
Definition
A bonus certain Indian employers must pay eligible employees under the Payment of Bonus Act, calculated within prescribed minimum and maximum percentages on qualifying wages.
Related Terms in Payroll
Labour Welfare Fund (LWF)
A state-administered fund in several Indian states to which small periodic contributions are made by employees and employers, funding welfare measures for workers. Rates and applicability vary by state.
Payroll Liabilities
Amounts owed as a result of running payroll but not yet paid out: net wages, income tax withheld, social-security and pension contributions, and any garnishments. They are liabilities held on behalf of employees and agencies, not business expenses in their own right.
Payroll Journal Entry
The entry recording a pay run, debiting gross wages and employer contributions to expense and crediting net pay plus each withholding and contribution liability. Settling those liabilities later is a separate entry that clears them to zero.
FICA
The US Federal Insurance Contributions Act tax funding Social Security and Medicare, withheld from employee wages and matched by the employer. The Social Security portion applies only up to an annual wage base, and an additional Medicare amount applies above a set income level; both figures are published yearly by the IRS and SSA.
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