Posts
Dearness Allowance DA
What is Dearness Allowance ?
Dearness Allowance is cost of living adjustment allowance which the government pays to the employees of the public sector as well as pensioners of the same. DA component of the salary is applicable to employees in India.
Dearness Allowance can be basically understood as a component of salary which is some fixed percentage of the basic salary, aimed at hedging the impact of inflation.
How to Calculate Dearness Allowance?
After the Second World War, DA component was introduced by the government. After 2006, the formula for calculating dearness allowance has changed and currently DA is calculated as follows,
For Central Government employees:
Dearness Allowance % = ((Average of AICPI (Base Year 2001=100) for the past 12 months -115.76)/115.76)*100
For Central public sector employees:
Dearness Allowance % = ((Average of AICPI (Base Year 2001=100) for the past 3 months -126.33)/126.33)*100
Where, AICPI stands for All-India Consumer Price Index.
From the year 1996, DA has been included to compensate for price rise or inflation in a particular financial year and hence it is revised twice every year, once in January and then in July.
What is Salary ?
!! Full Explanation of “SALARY” !!
Salary!
isn’t it every ones favorite? Its paid once in month & in 5 days or less fully expensed out.
We wait eagerly for whole month to receive the same. We work hard & with full efforts to earn this. When it is credited in bank a/c or received check or cash on pay day, see that smile on your face and specially your family.
Salary = Basic Pay + DA + NPA + HRA + TA + RA + WA – NPS – SI –HRD– TDS (Income Tax)
Components of Salary :
- Basic Pay
- Dearness Allowance
- Non Practising Allowance
- House Rent Allowance
- Travelling Allowance
- Rural Allowance
- Washing Allowance
- Contributory Pension Fund (NPS)
- State Insurance Premium
- House Rent Deduction
- Income Hai to Tax Hai
BASIC PAY –
Basic Pay = Pay in Pay Band + Grade Pay
Pay Band – 15600-39100 , Grade Pay – 5400
First Basic Pay = 15600+5400 = 21000
Increment – 3% of Basic pay every year (July)
If probation completes before 31st Dec.– 3% of Basic Pay will be added in NEXT July.
Tip – First increment will be added in Next year(July) of Probation completion year.
Example – If your probation is completing on any day of 2017 (1 January 2017 to 31 December 2017 ), you will get your first increment in July 2018.
Second Basic Pay = 3% of First Basic Pay+ First Basic Pay = 630+15600+5400 = 21630
Pay in Pay Band is increased from 15600 and becomes 16230.
Based on this basic pay all other allowance are calculated like Dearness Allowance (DA), House Rent Allowance (HRA), Non Practising Allowance (NPA) & Transport Allowance (TA).
How to check salary status –
<a href="/index.php?p=536">How to check salary status</a>