How do I calculate DR arrears on my pension?

Multiply your original basic pension (before commutation, including any additional pension for age 80+) by the increase in DR percentage, then multiply by the number of arrears months. For example, a 3% increase on ₹30,000 basic for 6 months = ₹900 × 6 = ₹5,400.

Is Dearness Relief paid on the commuted portion of pension?

Yes. DR is always calculated on the full original basic pension as recorded in your PPO, not the reduced amount received after commutation. Using the post-commutation figure is the most common reason pensioners under-estimate their DR and arrears.

When is DR revised for pensioners?

The central government typically revises Dearness Relief twice a year, effective 1 January and 1 July, with the formal order issued some weeks later. The gap between the effective date and the first revised payment is settled as lump-sum arrears.

DR Arrears Calculator — Dearness Relief Arrears for Pensioners (India, 2026)

Q: Are DR arrears taxable?

Yes. Pension including DR is taxable as salary income, and arrears are taxed in the year of receipt. Relief under Section 89(1), claimed via Form 10E, may reduce the tax impact when arrears relate to earlier financial years.

Your details

Basic pension (before commutation)

₹

Use your original basic pension from the PPO — DR is always calculated on the full basic, even if part is commuted.

Old DR rate 55%

New DR rate 58%

Months of arrears 6 months

Months between the effective date of the revision (e.g. 1 January / 1 July) and the month it actually starts being paid.

Additional pension for 80+? None

Pensioners aged 80+ receive additional basic pension (20% at 80, rising to 100% at 100). DR applies to that too — set the slider to your slab if applicable.

Total DR arrears due

₹5,400

3% increase on ₹30,000 × 6 months

Effective basic (incl. additional)—

DR at old rate / month—

DR at new rate / month—

Increase per month—

New monthly pension (basic + DR)—

Arrears are paid as a lump sum with the first revised pension credit. They are taxable as income in the year of receipt — Section 89 relief may apply if the arrears relate to earlier years.

DR (Dearness Relief) rates are announced by the government — usually effective 1 January and 1 July each year. This calculator computes arrears for any pair of rates; check the latest DoPPW/state order for the current percentage before using it as final.

The one mistake to avoid

DR is calculated on your full basic pension — even the commuted part.

If you commuted a portion of your pension at retirement, your monthly credit shows a reduced basic. But Dearness Relief is always computed on the original, pre-commutation basic pension in your PPO. Using the reduced figure is the single most common reason pensioners under-estimate their arrears. Pensioners aged 80 and above also receive additional pension (20% of basic at 80, stepping up to 100% at 100), and DR applies to that additional amount as well.

Common questions

DR arrears FAQs

What is Dearness Relief (DR)?

DR is the inflation-linked component of pension, expressed as a percentage of basic pension. It mirrors the Dearness Allowance (DA) paid to serving employees and is revised by the government — typically twice a year, effective 1 January and 1 July.

Why do arrears arise at all?

The revision is effective from 1 January or 1 July, but the government order is usually issued weeks or months later. The gap between the effective date and the first month the new rate is actually paid is settled as a lump-sum arrears credit.

Is DR paid on the commuted portion of pension?

Yes. DR is calculated on the full original basic pension as per your PPO, not the reduced amount you receive after commutation. This is a frequent source of confusion and under-calculation.

Are DR arrears taxable?

Yes — pension including DR is taxable as salary income, and arrears are taxed in the year of receipt. If the arrears relate to earlier financial years, relief under Section 89(1) (via Form 10E) can reduce the tax impact. Consult a CA for your specific case.

My arrears credit doesn't match this calculator. Why?

Common reasons: the bank used your post-commutation basic (raise it with your CPPC), your additional pension for age 80+ wasn't included, or the number of arrears months differs from what you assumed. Ask your branch for the arrears calculation sheet — you're entitled to it.