Salary Calculator India

Calculate your monthly take-home pay from annual CTC

Your total annual compensation package
Percentage of CTC allocated as bonus
House Rent Allowance as % of Basic Salary
Leave Travel Allowance as % of Basic Salary
State-level tax (max ₹2,500 annually)
Employer's PF contribution per month
Your PF contribution per month
Any other monthly deductions

CTC to In-Hand Salary Estimation (India 2025)

Below is an estimated monthly in-hand salary for different CTC levels, assuming standard salary structure (40% basic, 40% HRA of basic, 12% PF, ₹200/month professional tax, 10% bonus in CTC):

Annual CTCMonthly GrossMonthly DeductionsMonthly In-Hand (Approx.)Annual In-Hand
₹3 LPA₹22,500₹3,080₹19,420₹2.33L
₹5 LPA₹37,500₹4,360₹33,140₹3.98L
₹7 LPA₹52,500₹5,640₹46,860₹5.62L
₹10 LPA₹75,000₹7,560₹67,440₹8.09L
₹12 LPA₹90,000₹8,840₹81,160₹9.74L
₹15 LPA₹1,12,500₹10,760₹1,01,740₹12.21L
₹20 LPA₹1,50,000₹13,960₹1,36,040₹16.32L
₹25 LPA₹1,87,500₹15,960₹1,71,540₹20.58L
₹30 LPA₹2,25,000₹17,960₹2,07,040₹24.84L
₹40 LPA₹3,00,000₹19,960₹2,80,040₹33.60L
₹50 LPA₹3,75,000₹19,960₹3,55,040₹42.60L

Note: These are estimates before income tax. Actual in-hand will be lower after TDS. PF contribution is capped at ₹1,800/month (12% of ₹15,000 statutory limit). Higher CTC packages may have different structures.

Gross Salary vs Net Salary (Take-Home Pay)

Understanding the difference between gross and net salary is crucial for financial planning. Many employees are confused when their bank credit is significantly lower than the CTC mentioned in their offer letter.

Gross Salary (Before Deductions)

Gross salary = CTC minus employer-side costs that don't reach your payslip.

  • Includes: Basic + HRA + LTA + Special Allowance + Bonus
  • Excludes: Employer PF, Gratuity, Insurance premiums
  • Typically 80–90% of CTC
Net Salary (After Deductions)

Net salary = Gross salary minus all employee-side deductions.

  • Deducted: Employee PF, Professional Tax, TDS (Income Tax)
  • Also deducted: Voluntary deductions (NPS, insurance, LIC)
  • Typically 65–80% of CTC depending on tax slab
Formula:
CTC = Gross Salary + Employer PF + Employer Gratuity + Employer Insurance
Net Salary = Gross Salary − Employee PF − Professional Tax − TDS − Other Deductions

What is CTC (Cost to Company)?

CTC is the total expenditure a company incurs on an employee in a year. It includes every monetary benefit — direct payments, deferred benefits, and employer-side statutory contributions. The key distinction is that CTC is NOT your take-home salary; it's the total cost from the employer's perspective.

A typical Indian CTC package includes:

ComponentTypical %NatureReaches Your Bank?
Basic Salary40–50%Fixed, fully taxableYes (before TDS)
HRA16–25%Partially tax-exemptYes
Special Allowance10–20%Fully taxableYes
LTA4–5%Exempt with travel proofYes
Bonus/Variable Pay5–20%Taxable, paid periodicallyYes (quarterly/annually)
Employer PF4.8–6%Retirement benefitNo (goes to PF account)
Gratuity4.8%Paid on exit (after 5 years)No (only on separation)
Insurance (GMC)0.5–1.5%Health coverageNo (coverage benefit)

Indian Salary Components Explained

Basic Salary

Basic salary is the core fixed component, typically 40–50% of CTC. It forms the base for calculating HRA, PF, gratuity, and other benefits. A higher basic means higher PF contributions (good for retirement) but also higher taxable income. Companies sometimes keep basic low (at 40%) to reduce their PF liability.

House Rent Allowance (HRA)

HRA is paid to employees to meet rental expenses. It's typically 50% of basic salary for metro cities (Delhi, Mumbai, Chennai, Kolkata) and 40% for non-metro cities. The tax exemption on HRA is the minimum of:

  • Actual HRA received
  • 50% of basic (metro) or 40% of basic (non-metro)
  • Actual rent paid minus 10% of basic salary

If you don't pay rent or own your home, HRA is fully taxable.

Special Allowance

This is the balancing figure in your salary structure — whatever remains after allocating basic, HRA, LTA, and other fixed components. It's fully taxable and doesn't qualify for any exemption. Companies use it to adjust the salary to reach the total CTC figure.

Provident Fund (PF) Calculation

Both employer and employee contribute 12% of basic salary (capped at ₹15,000/month for statutory compliance). The employer's 12% is split: 8.33% goes to Employee Pension Scheme (EPS) and 3.67% to EPF. Employee's full 12% goes to EPF.

Example: If basic salary = ₹30,000/month
Employee PF = 12% of ₹15,000 = ₹1,800/month (statutory minimum)
Employer PF = 12% of ₹15,000 = ₹1,800/month
Note: Some companies contribute on full basic (not capped at ₹15,000), which increases deduction but builds higher retirement corpus.

Professional Tax

A state-imposed tax deducted from salary, capped at ₹2,500/year by the Constitution. Rates vary by state:

StateMonthly DeductionAnnual TotalApplicable Salary
Maharashtra₹200 (₹300 in Feb)₹2,500Above ₹10,000/month
Karnataka₹200₹2,400Above ₹15,000/month
West Bengal₹150₹1,800Above ₹10,000/month
Telangana₹200₹2,400Above ₹15,000/month
Tamil Nadu₹208₹2,500Above ₹21,000/month
Gujarat₹200₹2,400Above ₹12,000/month
RajasthanNot applicable
DelhiNot applicable

Gratuity

Gratuity is a lump sum paid when an employee completes 5+ years of continuous service. It's part of CTC but only paid on resignation, retirement, or death. The formula is:

Gratuity = (Last drawn basic salary × 15 × Years of service) / 26
Maximum tax-exempt gratuity: ₹20 lakh (for non-government employees)

Bonus

Bonus can be statutory (under the Payment of Bonus Act for employees earning up to ₹21,000/month) or performance-based (variable pay). When included in CTC, it reduces monthly in-hand salary since the amount is held and paid periodically. Some companies split bonus into quarterly payouts, while others pay annually.

New Tax Regime vs Old Tax Regime (FY 2025-26)

The tax regime you choose significantly impacts your take-home salary. The new regime (default from FY 2023-24) offers lower tax rates but removes most deductions and exemptions.

Income SlabNew Regime RateOld Regime Rate
Up to ₹3,00,000NilNil (up to ₹2.5L)
₹3,00,001 – ₹7,00,0005%5% (₹2.5L–₹5L)
₹7,00,001 – ₹10,00,00010%20% (₹5L–₹10L)
₹10,00,001 – ₹12,00,00015%20%
₹12,00,001 – ₹15,00,00020%30% (above ₹10L)
Above ₹15,00,00030%30%
New Regime Benefits:
  • Lower tax rates across all slabs
  • Standard deduction of ₹75,000
  • No need to invest in tax-saving instruments
  • Simpler compliance, no proofs required
  • Better for those with fewer deductions
Old Regime Benefits:
  • HRA exemption for rent-paying employees
  • Section 80C deduction up to ₹1.5L (PF, PPF, ELSS)
  • Section 80D for health insurance (₹25K–₹1L)
  • Home loan interest deduction (₹2L under Sec 24)
  • Better if total deductions exceed ₹3.75L
Rule of Thumb: If your total deductions + exemptions (HRA, 80C, 80D, LTA, home loan) exceed ₹3.75 lakh, the old regime may save more tax. Otherwise, the new regime with its lower rates is better.

Salary Breakup Examples for Common CTC Levels

Example 1: ₹5 LPA CTC (Fresher/Entry Level)

ComponentMonthlyAnnual
Basic Salary (40%)₹15,000₹1,80,000
HRA (50% of Basic)₹7,500₹90,000
Special Allowance₹12,167₹1,46,000
LTA₹1,500₹18,000
Gross Salary₹36,167₹4,34,000
Employee PF (12%)−₹1,800−₹21,600
Professional Tax−₹200−₹2,400
Monthly In-Hand₹34,167₹4,10,000

Example 2: ₹10 LPA CTC (Mid-Level)

ComponentMonthlyAnnual
Basic Salary (40%)₹30,000₹3,60,000
HRA (50% of Basic)₹15,000₹1,80,000
Special Allowance₹24,333₹2,92,000
LTA₹3,000₹36,000
Bonus (10% of CTC, annualized)₹8,333₹1,00,000
Gross Salary₹80,667₹9,68,000
Employee PF−₹1,800−₹21,600
Professional Tax−₹200−₹2,400
Employer PF (CTC component)−₹1,800−₹21,600
Monthly In-Hand (before TDS)₹67,440₹8,09,000

Example 3: ₹20 LPA CTC (Senior Level)

ComponentMonthlyAnnual
Basic Salary (40%)₹60,000₹7,20,000
HRA (50% of Basic)₹30,000₹3,60,000
Special Allowance₹48,667₹5,84,000
LTA₹6,000₹72,000
Bonus (15% of CTC)₹25,000₹3,00,000
Gross Salary₹1,69,667₹20,36,000
Employee PF−₹1,800−₹21,600
Professional Tax−₹200−₹2,400
Monthly In-Hand (before TDS)₹1,36,040₹16,32,000

Note: Income tax (TDS) will further reduce take-home. A person earning ₹20 LPA may pay ₹2.5–3.5L in income tax annually depending on regime and deductions claimed.

Employer vs Employee PF Contribution

AspectEmployee ContributionEmployer Contribution
Rate12% of basic salary12% of basic salary
Goes to100% to EPF account3.67% to EPF + 8.33% to EPS
Statutory cap₹15,000/month basic₹15,000/month basic
Max monthly₹1,800₹1,800
Impact on salaryDeducted from gross payPart of CTC, not in payslip
Tax benefitDeductible under 80CTax-free up to ₹7.5L/year
WithdrawalAfter retirement/5 yearsSame rules apply

Some companies offer "PF on full basic" instead of capping at ₹15,000. This means higher retirement savings but lower monthly take-home. For example, with basic of ₹50,000/month: Employee PF = ₹6,000/month vs ₹1,800/month (capped).

Common Payroll Deductions in India

DeductionTypeAmountTax Benefit
Employee PFMandatory12% of basic (max ₹1,800/month)80C deduction
Professional TaxMandatory (most states)₹150–₹200/monthDeductible from salary income
Income Tax (TDS)MandatoryAs per tax slabN/A (it IS the tax)
NPS (Tier 1)VoluntaryEmployee choice₹50,000 extra under 80CCD(1B)
Health InsuranceOptional₹500–₹2,000/month80D deduction
LIC PremiumVoluntaryAs per policy80C deduction
Loan Recovery (EMI)OptionalAs per loan80E (education) / 24(b) (home)
Food Coupons (Sodexo)Optional₹2,200/month maxTax-free up to ₹2,200/month

Frequently Asked Questions

CTC (Cost to Company) is the total annual cost an employer spends on you, including your salary, employer PF, gratuity, insurance, and bonuses. In-hand salary is what actually gets credited to your bank account after deducting employee PF, professional tax, and income tax (TDS). Typically, in-hand salary is 65–80% of CTC depending on your tax slab and deductions.

Basic salary is typically 40–50% of CTC in most Indian companies. The exact percentage depends on company policy. A higher basic increases PF contribution and gratuity (better for retirement) but also increases taxable income. IT companies generally keep basic at 40%, while manufacturing/PSU companies may keep it higher at 50–60%.

Gross salary is your total pay before any deductions — it includes basic, HRA, LTA, special allowance, and bonuses. Net salary (take-home) is what you receive after deducting employee PF, professional tax, TDS, and any voluntary deductions. Gross salary is always part of CTC, while employer contributions like employer PF and gratuity are separate CTC components that don't appear in your payslip.

Employee PF contribution is 12% of basic salary. For statutory compliance, PF is calculated on basic up to ₹15,000/month (₹1,800/month deduction). However, some companies calculate PF on full basic salary without capping, which means higher deduction but also higher retirement savings. Both employer and employee contribute equally — the employer's share comes from CTC, while the employee's share is deducted from gross salary.

Yes, if you own your house and live in it, HRA is fully taxable. The HRA exemption under Section 10(13A) is only available to employees who pay rent. However, if you own a house in one city and pay rent in another city (e.g., own in hometown, rent in work city), you can claim both HRA exemption and home loan interest deduction. You can also pay rent to parents (if they own the house) to claim HRA exemption.

Choose the old regime if your total deductions and exemptions (HRA, 80C, 80D, home loan, LTA) exceed ₹3.75 lakh. Choose the new regime if you have minimal deductions, don't pay rent, or don't invest in tax-saving instruments. For salary up to ₹7.5 lakh (new regime) or ₹5 lakh (old regime), tax is effectively zero due to rebate under Section 87A. Salaried employees can switch between regimes every year.

Gratuity is a retirement benefit paid when you leave a company after completing 5 or more years of continuous service. Formula: (Last basic salary × 15 × years of service) / 26. It's shown in CTC but only paid on separation. Maximum tax-free gratuity is ₹20 lakh. If you leave before 5 years, you forfeit the gratuity amount (though some companies pay it voluntarily).

The gap between CTC and in-hand salary exists because CTC includes: (1) Employer PF contribution (doesn't reach your bank), (2) Gratuity provision (paid only after 5 years), (3) Insurance premiums (coverage benefit, not cash), (4) Employee PF (goes to your PF account, not bank), (5) Professional tax, and (6) Income tax (TDS). For a ₹10 LPA CTC, in-hand is typically ₹60,000–70,000/month before income tax.

To maximize take-home: (1) Ask HR to restructure salary with more flexible components like food coupons (₹2,200/month tax-free), (2) Claim HRA exemption by submitting rent receipts, (3) Opt for new tax regime if you have fewer deductions, (4) Request leave encashment instead of carrying forward leaves, (5) Negotiate performance bonus as a larger percentage, (6) Consider opting out of higher PF contribution (if company contributes on full basic).

The standard deduction for FY 2025-26 is ₹75,000 under the new tax regime and ₹50,000 under the old tax regime. It's a flat deduction from gross salary income — no proof or investment required. It replaced the earlier transport allowance (₹19,200) and medical reimbursement (₹15,000) from FY 2018-19 onwards. Both regimes offer this deduction, making it universally beneficial.

This varies by company. Most Indian companies include bonus (variable pay/performance incentive) within CTC. This means your fixed monthly salary is lower because a portion is held for bonus payouts. Some companies offer bonus "over and above" CTC, which is extra income. Always clarify this during offer negotiation — a ₹12 LPA CTC with 20% variable means only ₹9.6L is fixed pay.

Income tax on salary is calculated as: (1) Start with gross salary income, (2) Subtract standard deduction (₹50,000 old / ₹75,000 new regime), (3) Subtract exempt allowances (HRA, LTA — old regime only), (4) Subtract Chapter VI-A deductions (80C, 80D — old regime only), (5) Apply tax slab rates on the remaining taxable income, (6) Add 4% health and education cess on total tax, (7) Deduct monthly TDS = Annual tax / 12.

Related Calculators

Income Tax Calculator HRA Calculator EPF Calculator Gratuity Calculator NPS Calculator Retirement Calculator EMI Calculator PPF Calculator
Quick Reference
Standard Salary Structure:
  • Basic Salary: 40–50% of CTC
  • HRA: 40–50% of Basic
  • LTA: 8–10% of Basic
  • Special Allowance: Balance amount
  • PF: 12% of Basic (both sides)
  • Gratuity: 4.81% of Basic
Tax Saving Tips
  • Claim HRA with rent receipts (up to ₹1L+ savings)
  • Max out 80C: EPF + PPF + ELSS = ₹1.5L
  • Health insurance: ₹25K (self) + ₹50K (parents)
  • NPS: Extra ₹50K deduction under 80CCD(1B)
  • Home loan: ₹2L interest + ₹1.5L principal
  • Food coupons: ₹26,400/year tax-free
  • Leave encashment: Plan before year-end
Income Tax Rebate

Section 87A Rebate (FY 2025-26):

  • New Regime: Income up to ₹7L = Zero tax
  • Old Regime: Income up to ₹5L = Zero tax
  • With standard deduction (₹75K new regime), effective zero-tax income = ₹7.75L