Variable compensation · component
Joining and retention bonus
Fully taxable as salary in the year received, including any amount later clawed back.
How the taxable value is determined
Taxed on receipt at your slab rate. Where a bonus is refunded on early exit, relief depends on the year of refund and the employer's treatment; keep the clawback agreement.
Regime availability
- Old regime
- Prescribed value applies
- New regime
- Prescribed value applies
Documentation to keep
Offer letter and the clawback clause.
Legal basis: Section 17(1), Income-tax Act
Frequently asked questions
Is joining and retention bonus taxable in India?
Fully taxable as salary in the year received, including any amount later clawed back. Taxed on receipt at your slab rate. Where a bonus is refunded on early exit, relief depends on the year of refund and the employer's treatment; keep the clawback agreement.
Does the exemption apply under the new tax regime?
Under the old regime this treatment is not applicable — the value is prescribed, not exempted; under the new regime it is not applicable — the value is prescribed, not exempted. Legal basis: Section 17(1), Income-tax Act.
What records should I keep for joining and retention bonus?
Offer letter and the clawback clause.
Related tools & guides
Reflects provisions in force for FY 2026-27; verify against the latest government publications (incometax.gov.in). Information, not tax advice.