All you need to know about the Cost of Living Allowance(COLA) as a Ghanaian teacher.

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What is COLA?
COLA stands for Cost-Of-Living Allowance. It is usually an amount of money paid to workers, citizens of a country, to cushion them in difficult economic times. For a example, when there is high inflation.


What percentage is COLA?
The government of Ghana has agreed to cushion her workers with a 15% COLA,, although that is not what the various leaders of labour unions wanted. Workers wanted 20% COLA, but got 15% in return.


When will COLA be paid?
Public sector workers e.g. teachers and nurses will start receiving COLA from July 2022. This will appear on their July payslip as well. Thus, it will be paid monthly.



Is COLA taxable?
No. Tax and SSNIT deduction will not affect the allowance. 


Is COLA permanent?
No. It will be scrapped off as soon as the government of the day deems it fit to discontinue its payment. Thus, it is rumored to be replaced by salary increment in January 2023. 



How Can I Calculate COLA on my salary?
COLA is calculated on a workers basic salary. In the case of teachers, your basic salary is the one above the Retention Premium on your Payslip  





Since Retention Premium is 15% of Basic Salary summed up to make your Gross salary, we can therefore deduce that COLA is equal to Retention premium. For example, if your Retention Premium is GH¢300, your COLA will also be GH¢300. And if your Basic Salary is GHC 1,000, then, your gross salary equals Retention Premium + Basic Salary +COLA Therefore, Gross salary = GH¢ 300 + GH¢1,000 + GH¢300 =GH¢1,600.00 

Note: SSNIT contribution, Taxes, union dues, loan deductions etc. will be deducted from your Basic Salary and Retention Premium only. Basic Salary is the same as Single Spine Salary.

By: Yaw Indomie

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