According to the Employees’ Provident Fund Act, EPF is required to be paid as long as the income is received for work done under an employment contract. Bonuses are recorded as part of the employee’s personal income and are therefore subject to EPF.
However, incentives (Ganjaran) or angpao are not considered as income for work done under the contract and therefore are not subject to EPF.
In addition, bonuses are taxable under the Income Tax Act, so any bonuses you receive are subject to personal income tax. If you are making monthly direct tax deductions from your salary (PCB), then the bonus you receive will be the amount that has been deducted.
So when you file your tax return every other year, remember to enter the bonus you received.
