Payroll
Dearness allowanceDA
Dearness allowance is a cost-of-living component, common in government and public-sector pay, that is added to basic for PF and gratuity purposes.
DA was introduced to offset inflation and is revised periodically against the consumer price index. In the private sector it is uncommon, but where it exists it is treated as part of wages.
PF and gratuity are calculated on basic plus DA, so the two are usually shown together as one figure.
In Indian payroll
When a structure has DA, statutory calculators must add it to basic before applying PF rates and the ₹15,000 wage ceiling.
What is Dearness allowance?
Dearness allowance is a cost-of-living component, common in government and public-sector pay, that is added to basic for PF and gratuity purposes.
Why does Dearness allowance matter in Indian payroll?
When a structure has DA, statutory calculators must add it to basic before applying PF rates and the ₹15,000 wage ceiling.
Related terms
In Kuzhu
The Payroll module in Kuzhu is where Dearness allowance is handled, on the same employee record as everything else.
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