Is the varaible pay depends on individual performance or both individual and company performance. When do we budget varaible pay, is it at the end of the year before performance reviews are rolled out or budgeted along with hr budget

Usually for junior levels, factoring in company performance is not a good idea. But for mid and senior levels, bonus should definitely be linked to individual and company performance, in my opinion. Budget variable pay at the beginning of the year so that you can also make adjustments to increase/decrease as per market conditions and performance.

Okay we budget individual goals bonus before we annouce to employees so that we can pay them. But for company performance bonus we can factor first three quarters in a year or consider at the beginning of the year