Work out the back pay for the 4% DA hike from 38% to 42%: monthly gain, total arrear and NPS deduction.
38 to 42 Percent DA Arrear Formula
The Dearness Allowance for central government employees rose from 38% to 42% under the 7th Pay Commission, a 4% increase effective from 1 January 2023 and announced in March 2023. Because the order came after the effective date, employees received the difference for the earlier months as arrears. The calculation is:
Total Arrear = Basic Pay × ((42 − 38) ÷ 100) × Number of Months
In other words, the monthly gain is 4% of basic pay. For a basic pay of ₹56,100 it is ₹2,244, so three months of arrear is ₹6,732. This calculator rounds the monthly figure to the nearest rupee and then multiplies it by the pending months.
Pay Matrix Quick Reference: 4% Difference
This table shows the exact 4% monthly difference and the 3-month arrear for common pay matrix entry points.
| Pay Level | Basic Pay | Monthly 4% Difference | 3-Month Arrear | After 10% NPS |
|---|
| Level 1 | ₹18,000 | ₹720 | ₹2,160 | ₹1,944 |
| Level 6 | ₹35,400 | ₹1,416 | ₹4,248 | ₹3,823 |
| Level 10 | ₹56,100 | ₹2,244 | ₹6,732 | ₹6,059 |
| Level 12 | ₹78,800 | ₹3,152 | ₹9,456 | ₹8,510 |
If your basic pay changed during the period, or your payment is pending for a different number of months, enter your own figures above. For other rates, use the DA arrear calculator, for a month-by-month sheet see the DA calculator Excel sheet, and for the current DA see the online DA calculator or the home page.
Frequently Asked Questions (FAQ)
How is the 38% to 42% DA arrear calculated?
Total Arrear = Basic Pay × ((42 − 38) ÷ 100) × Number of Months. For a basic pay of ₹35,400, the monthly gain is ₹1,416, so three months of arrear is ₹4,248 before NPS.
Which months does the 38% to 42% DA arrear cover?
The 4% rise was effective from 1 January 2023 but was announced in March 2023, so the arrear covered January, February and March 2023, which is 3 months. If your payment was delayed or you are checking old accounts, change the months in the calculator.
Did this 4% hike change HRA or provident fund?
HRA is a percentage of basic pay, and the slab changes only when DA crosses a set limit, 25% earlier and 50% later. A rise from 38% to 42% did not change the HRA slab. GPF subscriptions are usually based on basic pay, not DA. For NPS employees, the 10% contribution applies to Basic Pay plus DA, so it also applies to the arrear.
How do I claim tax relief under Section 89(1) on lump-sum arrears?
Arrears are taxed in the year you receive them. If they relate to earlier years, you can claim relief under Section 89(1) by filing Form 10E on the income tax e-filing portal before filing your return. Eligibility depends on your income and tax regime, so confirm with your DDO or a tax professional. Use the DA arrear calculator for other rates.