Dearness Allowance is the part of a central government salary that rises with inflation, paid as a percentage of basic pay; pensioners get the same as Dearness Relief. It is revised twice a year, effective 1 January and 1 July, using the AICPI-IW index, via the formula DA% = [(12-month average AICPI-IW − 261.42) ÷ 261.42] × 100. The current rate is 60% of basic pay effective January 2026, with a rise to about 63% from July 2026 expected but not yet confirmed. When a new Pay Commission takes over, the accumulated DA merges into the new basic and the counter resets, so a high DA is absorbed into a higher basic, not lost.
By Vishal Thakur, Senior Editor — Central Recruitment. Published 18 June 2026. Last verified 18 June 2026.
In short
- Dearness Allowance (DA) is the part of a central government salary that rises with inflation, so your real income does not fall as prices climb. Pensioners get the same thing under the name Dearness Relief (DR).
- It is revised twice a year — effective 1 January and 1 July — using the AICPI-IW index published by the Labour Bureau.
- The current rate is 60% of basic pay, effective January 2026; a rise to around 63% from July 2026 has been reported and is expected, not yet confirmed for every reader's payslip.
- When a new Pay Commission takes over, the built-up DA is merged into the new basic and the DA counter restarts near zero.
If you read your government payslip and wonder why "DA" is one of the biggest lines after basic pay, this is the explainer for you. Dearness Allowance is not a bonus or a discretionary perk — it is a built-in inflation adjustment, governed by a formula, revised on a fixed calendar. Understanding how it is calculated tells you why your salary quietly grows twice a year, and what will happen to that growth when the next Pay Commission arrives.
What DA is and why it exists
Prices rise every year, so a fixed salary loses purchasing power over time. Dearness Allowance exists to offset that. It is paid as a percentage of your basic pay and is recalculated periodically so that your take-home keeps pace with the cost of living. For retired employees the identical mechanism is called Dearness Relief, applied to the pension. The two move together, which is why a DA announcement is always also a DR announcement.
How DA is calculated
DA is tied to a real price index, not to anyone's discretion. The index is the All-India Consumer Price Index for Industrial Workers (AICPI-IW), published monthly by the Labour Bureau under the Ministry of Labour and Employment. The standard formula used since the 7th Pay Commission is:
DA % = [(12-month average of AICPI-IW − 261.42) ÷ 261.42] × 100
In plain terms: take the average index over the past twelve months, compare it to the base figure fixed at the start of the current pay scale, and express the gap as a percentage. As the cost of living rises, the index rises, and the DA percentage rises with it.
Two practical points follow from the calendar:
- DA is revised twice a year, effective 1 January and 1 July.
- The revision is usually announced a little after its effective date, and the gap is paid as arrears.
The current rate and how it got here
DA has climbed steadily for years. It crossed 50% in 2024, an important threshold because some allowances are linked to DA milestones. The current rate is 60% of basic pay, effective from January 2026. Reports point to a further hike of about 3%, taking DA to roughly 63% from July 2026 — treat that as expected until it is officially notified, since the final figure follows the published index.
| Milestone | DA rate | Note |
|---|---|---|
| Crossed 50% | 50% | Triggers revision of certain DA-linked allowances |
| January 2026 | 60% | Current rate |
| July 2026 | ~63% (expected) | Reported hike, pending official notification |
How a DA hike actually changes your salary
Because DA is a percentage of basic pay, a 3% DA increase means an extra 3% of your basic added to your monthly pay, plus the same lift on your pension if you are retired. The effect is larger at higher basic-pay levels and compounds over a career.
There is a second, less obvious effect. Some allowances — most notably House Rent Allowance (HRA) — are revised upward when DA crosses certain thresholds (such as 25% and 50%). So a DA milestone can quietly raise more than one line on your payslip. This is part of why government pay feels stable even between Pay Commissions: the structure keeps adjusting to inflation on its own.
What happens to DA at the 8th Pay Commission
This is the key link between DA and the bigger pay story. When a new Pay Commission revises the pay structure, the accumulated DA is merged into the new basic pay, and the DA counter effectively resets near zero, then starts building again from the next index cycle. So a high DA today is not lost — it gets absorbed into a higher basic, on which all future DA, HRA and pension are then calculated.
That is exactly why employees track both numbers together. If you want the full picture of the coming revision, read what the 8th Pay Commission could change and when. And because DA and DR feed directly into pension, the choice of pension scheme matters too — our comparison of UPS, NPS and OPS explains how inflation protection works under each.
Why this matters even before you get the job
DA is one of the reasons a government salary is worth more than its headline basic suggests. When you compare offers, the DA-and-allowance structure is the difference between a number on paper and real take-home that keeps up with prices — a point we make in government job versus private job in 2026. To see how basic, DA and allowances stack into actual pay, our breakdowns of SSC CGL salary by post and bank PO salary show the components in context. To browse what is open right now, start at the jobs board.
Dearness Allowance: हिंदी सारांश
महंगाई भत्ता (DA) केंद्र सरकार के वेतन का वह हिस्सा है जो महंगाई के साथ बढ़ता है, ताकि कीमतें बढ़ने पर आपकी वास्तविक आय न घटे; पेंशनभोगियों के लिए यही महंगाई राहत (DR) कहलाता है। यह साल में दो बार — 1 जनवरी व 1 जुलाई से — AICPI-IW सूचकांक के आधार पर संशोधित होता है। वर्तमान दर 60% (जनवरी 2026 से प्रभावी) है; जुलाई 2026 से लगभग 63% की वृद्धि की उम्मीद है (आधिकारिक अधिसूचना तक पुष्टि नहीं)। जब नया वेतन आयोग लागू होता है, तब जमा हुआ DA नए मूल वेतन में विलय हो जाता है और DA काउंटर लगभग शून्य से फिर शुरू होता है — यानी आज का ऊँचा DA खोता नहीं, उच्च मूल वेतन में समाहित हो जाता है।