Botswana Severance Benefit Calculator
Compute statutory terminal severance benefit entitlements in Botswana : 1 day's basic wage per month for the first 60 months, 2 days per month thereafter, 5-year interim cash-outs, and daily wage divisors in Botswana Pula (BWP / P).
Typical Service Tenure Milestones
💼 Wage & Continuous Service Inputs
Cap. 47:01 Sec. 27Basic monthly rate excluding discretionary bonuses or irregular allowances.
84 months = 7.0 years of continuous service.
Statutory daily divisor for converting monthly pay.
Section 27(2) permits interim 5-year payouts during ongoing service.
🧾 Severance Entitlement
Section 27 Benefit⚖️ Pension Fund Exemption Rule :
Employers who contribute to an approved occupational retirement scheme offering benefits equal to or greater than Section 27 are exempt from paying statutory severance benefit.
⚖️ Botswana Severance Benefit Accrual Framework (Section 27)
Statutory accrual rates, tenure milestones, and taxation rules in Botswana.
| Service Period | Accrual Formula | Maximum Days per Period | Statutory Reference |
|---|---|---|---|
| First 60 Months (Years 1 to 5) | 1 day basic wage per completed month | 60 working days | Employment Act Section 27(1)(a) |
| Service Beyond 60 Months (Year 6+) | 2 days basic wage per completed month | 24 days per year (Double rate) | Employment Act Section 27(1)(b) |
| Interim 5-Year Cash-Out Option | Payable at end of each 60-month cycle | Continuous employment retained | Employment Act Section 27(2) |
| BURS Severance Tax Exemption | First 1/3 or P 36,000 exempt from tax | Whichever is greater | Income Tax Act Second Schedule |
❓ Frequently Asked Questions • Severance Benefit in Botswana
Statutory rights, accrual formulas, pension exemptions, and tax treatment under Botswana labour law.
Who is entitled to severance benefit in Botswana? ▼
Under Section 27 of the Botswana Employment Act (Cap. 47:01), an employee who has completed at least 60 continuous months of service with an employer is entitled to severance benefit upon termination or completion of each 60-month period, provided they are not covered by an approved employer pension or gratuity scheme that offers superior benefits.
How is statutory severance pay calculated in Botswana? ▼
Severance pay is calculated in two statutory tiers: (1) for the first 60 months of continuous employment, the employee earns one (1) day's basic wage per completed month (up to 60 days); (2) for every completed month beyond 60 months, the accrual rate doubles to two (2) days' basic wage per month.
Can an employee cash out severance pay after 5 years while still working? ▼
Yes. Section 27(2) allows an employee to be paid their accrued severance benefit at the end of each 60-month (5-year) cycle of continuous employment without terminating their employment contract. Subsequent service continues to accrue at the higher rate of 2 days per month.
How is the daily wage rate calculated for severance pay? ▼
The daily basic wage rate is determined by dividing the employee's monthly basic salary by 22 working days for employees on a 5-day working week, or by 26 working days for employees on a 6-day working week.
Is severance pay subject to income tax under BURS in Botswana? ▼
Under the Botswana Income Tax Act, the first one-third (1/3) of severance pay or P 36,000 (whichever is greater) is exempt from income tax. The remaining balance is subject to PAYE withholding tax.
Engr. Muhammad Shahzad
Verified Author • Labour Economics & Compensation Systems EngineerLead computer systems engineer and compensation taxation analyst. Specialist in statutory terminal benefits, Employment Act compliance in Botswana and the SADC region, and automated financial algorithm architectures.
📊 Botswana Unified Statutory Matrix & BURS Schedule
| Statutory Component / Legal Deduction Item | Calculated Amount (BWP) |
|---|---|
| Primary Net / Statutory Payable Amount | P 0.00 |
Engr. Muhammad Shahzad
Principal Financial Systems Architect & Southern African Development Community (SADC) Tax Systems Lead
Lead software and systems architect specializing in high-performance browser computing, algorithmic validation, financial models, and zero-telemetry client-side privacy architecture.