How to update the settings for tax calculation on bonuses

Bonuses affect employees’ TDS (Tax Deducted at Source) calculations.
In Keka, you can configure whether to include future-dated bonuses in projected tax calculations or deduct taxes only when the bonus is paid.

Follow the steps below to update these settings:

Steps to Configure Bonus Tax Calculation

1. Go to Payroll → Settings → Pay Groups.

2. Select the relevant Pay Group and click Configure under Actions.

   

3. Navigate to Other Settings → Miscellaneous Settings.

4. Click the three dots (⋮) → Update Settings.

   

5. On the Miscellaneous Settings window, scroll to the Additional section.

6. Answer Yes or No for:

   • “Do you consider bonuses with future payout dates (unpaid bonuses) for projected tax calculation?”

7. If you select No, you’ll be prompted to answer another question:

   • “Do you deduct total payable tax on bonus in the month it is paid out?”
     Choose Yes or No, then click Save.