What is the difference between CTC and in-hand salary?

CTC (Cost to Company) is the total amount your employer spends on you, including your basic salary, HRA, allowances, employer PF contribution, gratuity, bonus, and insurance. In-hand salary is what you actually receive after deducting employee PF, professional tax, income tax, and other deductions from your gross salary.

How is in-hand salary calculated?

In-hand salary = Gross Salary minus (Employee PF + Professional Tax + Income Tax + Other Deductions). Gross salary typically includes basic salary, HRA, special allowances, and other perks. Basic salary is usually 40-50 per cent of CTC, and HRA is about 40-50 per cent of basic depending on your city classification.

What is professional tax?

Professional tax is a state-level tax levied on salaried employees and professionals. The maximum amount is Rs 2,500 per year (about Rs 208 per month in most states). It is deducted by the employer from salary and deposited with the state government. Karnataka charges Rs 200 per month for most salary brackets. States like Delhi, Haryana, and Rajasthan do not levy professional tax.

What is the standard basic salary percentage of CTC?

Basic salary is typically 40-50 per cent of your CTC. It forms the basis for calculating HRA (usually 40-50 per cent of basic), PF (12 per cent of basic), and gratuity (4.81 per cent of basic). A lower basic reduces employer costs but also reduces retirement benefits and HRA exemption eligibility.

How much tax is deducted from salary every month?

Tax deducted at source (TDS) depends on your estimated annual tax liability divided by 12 months. Your employer calculates tax based on the tax regime you choose (old or new), your declared investments under Section 80C, 80D, and other deductions, and applies the applicable slab rates. You submit investment proofs to your employer at the start of the year to avoid higher TDS.

What deductions are made from my salary?

Common deductions include: Employee Provident Fund (EPF) at 12 per cent of basic salary, Professional Tax (Rs 200-300 per month depending on state), and Income Tax TDS based on your chosen tax regime and slab. Some employers also deduct contributions towards group insurance or other voluntary schemes.

What is the salary structure in India?

A typical Indian salary structure includes: Basic Salary (40-50 per cent of CTC), House Rent Allowance (HRA at 40-50 per cent of basic), Special Allowance (to make up the remainder), Employer PF (12 per cent of basic), Gratuity (4.81 per cent of basic), and performance bonus. Conveyance allowance, medical allowance, and leave travel allowance are common additions.

How does gratuity affect in-hand salary?

Gratuity is paid by the employer and is not deducted from your salary. It is calculated at 4.81 per cent of basic salary and is paid when you leave the company after completing 5 years of continuous service. Since gratuity is an employer cost, it reduces the amount available for your gross salary but does not directly affect your monthly in-hand pay.

Can NRI employees use this in-hand salary calculator?

Yes. This calculator includes a multi-currency selector that converts amounts to USD, EUR, GBP, and other currencies. NRI employees can enter their Indian CTC in rupees and view the breakdown in their preferred currency. The PF and tax calculations follow Indian regulations which apply to income earned in India regardless of residence status.

What is the meaning of in-hand salary?

In-hand salary, also called take-home salary or net salary, is the amount that actually gets credited to your bank account each month after all deductions are made from your gross salary. It excludes employer-side costs like employer PF, gratuity, and insurance that are part of CTC but never reach your pocket.

Fermor is a financial platform built for India. The calculators are the distribution layer: free tools that give real answers to real financial questions, with no sign-up required. The product being built is an automated financial action system that uses the Account Aggregator framework to connect real financial accounts and close the gap between knowing what you should do with your money and actually doing it. Fermor is not a comparison site or a content platform. The calculators earn trust. The action platform is the product.

What is the in-hand salary for 28000 CTC per month?

For a monthly CTC of Rs 28,000 (Rs 3,36,000 per year), the estimated in-hand salary is approximately Rs 26,456. Deductions include employee EPF at 12 per cent of basic salary Rs 11,200 (Rs 1,344) and professional tax of Rs 200. No income tax applies at this salary level under the new tax regime for FY 2025-26, as annual income falls well below the Rs 12 lakh rebate threshold.

What is the in-hand salary for 20000 CTC per month?

For a monthly CTC of Rs 20,000 (Rs 2,40,000 per year), the estimated in-hand salary is approximately Rs 18,840. With basic salary at 40 per cent (Rs 8,000), employee EPF is Rs 960 and professional tax is Rs 200. No income tax applies at this income level. In-hand is approximately 94 per cent of the gross CTC at this salary range.

What is the in-hand salary for 40000 CTC per month?

For a monthly CTC of Rs 40,000 (Rs 4,80,000 per year), the estimated in-hand salary is approximately Rs 37,880. Deductions include employee EPF at 12 per cent of basic Rs 16,000 (Rs 1,920) and professional tax of Rs 200. No income tax applies under the new regime for FY 2025-26 as annual income is below the Rs 12 lakh rebate threshold.

What does CTC mean in salary?

CTC stands for Cost to Company. It is the total annual amount an employer spends to employ a person, including basic salary, HRA, all allowances, employer EPF contribution (12 per cent of basic), gratuity provision (4.81 per cent of basic), and other benefits like insurance or food coupons. CTC always exceeds in-hand salary because it includes employer-side costs that employees do not receive directly. Most Indian companies quote salaries as CTC in offer letters.

Which tax regime gives higher in-hand salary?

The new tax regime gives higher in-hand salary for most salaried employees with CTC below Rs 15 lakh who do not have large Section 80C investments or significant HRA exemption claims. For salaries above Rs 15 lakh with full 80C investments of Rs 1.5 lakh, NPS contribution, and home loan interest, the old regime may result in lower tax. Employees should compare both regimes using the calculator before choosing.

What is the 8th Pay Commission salary revision?

The 8th Pay Commission was constituted by the Union Cabinet in January 2025 to revise the pay structure for central government employees, with implementation expected from January 2026. The commission will recommend revised basic pay based on a fitment factor applied to current 7th CPC pay levels. The 7th Pay Commission had used a fitment factor of 2.57 in 2016. Central government employees can use the in-hand salary calculator to estimate take-home once the revised basic salary is announced.

In-Hand Salary Calculator: Calculate Take-Home Pay from CTC | Fermor

What Is In-Hand Salary?

In-hand salary, also called take-home pay or net salary, is the amount that actually gets credited to your bank account each month after all deductions are subtracted from your gross salary. It is what you keep, not what your employer spends on you.

Your CTC (Cost to Company) includes employer-side costs like employer PF contribution, gratuity, and insurance premiums that you never receive directly. This is why your in-hand salary is typically 15-25 per cent lower than your monthly CTC equivalent. Understanding the gap between CTC and in-hand pay is essential when evaluating job offers or planning your monthly budget.

The three main deductions from your gross salary are: Employee Provident Fund (12 per cent of basic), Professional Tax (state-dependent, up to Rs 2,500 per year), and Income Tax TDS (based on your tax regime and applicable slab rates). The calculator above computes TDS automatically under either the old or new regime.

In-Hand Salary Formula and Calculation

In-Hand Salary = Gross Salary minus (Employee PF + Professional Tax + Income Tax TDS)

Gross salary is the sum of basic salary, HRA, special allowances, and any other allowances paid by the employer. It excludes employer-side costs like employer PF, gratuity, and insurance premiums.

Example: CTC of Rs 12,00,000 per year. Basic salary at 40 per cent = Rs 40,000 per month. HRA at 20 per cent = Rs 20,000 per month. Employer PF (12 per cent of basic) = Rs 4,800. Gratuity (4.81 per cent of basic) = Rs 1,924. Gross salary = Rs 12,00,000 minus Rs 4,800 minus Rs 1,924 per month = Rs 93,276 per month. Special allowance = Rs 33,276. Employee PF at 12 per cent of basic = Rs 4,800. Professional Tax = Rs 200. Income Tax TDS (new regime, FY 2025-26) = Nil (annual gross Rs 11,19,312 is below Rs 12 lakh rebate threshold). In-hand salary = Rs 88,276 per month.

Salary Breakup Example (CTC Rs 12,00,000)

Sample salary breakup for CTC of Rs 12,00,000 per annum
Component	Monthly (Rs)	% of CTC
Basic Salary	Rs 40,000	40.0%
HRA	Rs 20,000	20.0%
Special Allowance	Rs 33,276	33.3%
Employer PF (12% basic, in CTC)	Rs 4,800	4.8%
Gratuity (4.81% basic, in CTC)	Rs 1,924	1.9%
Gross Salary	Rs 93,276	93.3%
Employee PF (12% of basic)	Rs -4,800	-4.8%
Professional Tax	Rs -200	-0.2%
Income Tax TDS (new regime)	Rs Nil	0%
In-Hand Salary	Rs 88,276	88.3%

CTC vs Gross Salary vs Net Salary

These three terms represent different amounts. CTC is the total employer cost, gross salary is what you earn before deductions, and net salary (in-hand) is what you actually receive.

Difference between CTC, gross salary, and net salary
Term	Includes	Excludes
CTC	Basic + HRA + Allowances + Employer PF + Gratuity + Bonus + Insurance	Nothing (it is the total cost)
Gross Salary	Basic + HRA + Allowances + Bonus	Employer PF, Gratuity, Insurance
Net Salary (In-Hand)	Gross Salary minus Deductions	Employee PF, Professional Tax, Income Tax TDS

PF and Professional Tax Deductions

Employee Provident Fund (EPF) is a mandatory retirement savings scheme regulated by the EPFO. The employee contributes 12 per cent of basic salary. The employer contributes 12 per cent of basic, split into 8.33 per cent towards EPS (Employee Pension Scheme) and 3.67 per cent towards EPF. The EPF account earns interest at a rate set annually by the EPFO, which was 8.25 per cent for FY 2025-26.

Professional tax is a state-level tax on salaried employees. The maximum amount across states is Rs 2,500 per year. The table below shows the rate for major states.

State-wise professional tax rates for salaried employees (2025)
State	Monthly Professional Tax	Threshold
Karnataka	Rs 200/month	Salary above Rs 15,000
Maharashtra	Rs 175-300/month	Based on salary slab
Tamil Nadu	Up to Rs 208/month	Salary above Rs 21,000
West Bengal	Rs 110-200/month	Based on salary slab
Telangana	Rs 150-200/month	Based on salary slab
Andhra Pradesh	Rs 150-200/month	Based on salary slab
Gujarat	Rs 200/month	Salary above Rs 12,000
Madhya Pradesh	Rs 208/month	Salary above Rs 25,000
Delhi	Nil	No professional tax
Haryana	Nil	No professional tax
Rajasthan	Nil	No professional tax
Uttar Pradesh	Nil	No professional tax

Use the Gratuity Calculator to estimate your gratuity amount and understand how it fits into your overall compensation structure.

Salary Components Explained

A typical Indian salary structure includes these components:

Basic Salary: The core component, typically 40-50 per cent of CTC. It determines PF, gratuity, and HRA calculations. A higher basic means higher retirement benefits but also higher PF deductions.

House Rent Allowance (HRA): Paid to cover rental expenses. Usually 40-50 per cent of basic in metro cities. Tax exemption under Section 10(13A) applies if you live in rented accommodation.

Special Allowance: The balancing figure that makes up the difference between CTC and the sum of other components. Fully taxable.

Performance Bonus: Variable pay based on individual and company performance. Typically 10-20 per cent of CTC. Taxed in the year of receipt.

Employer PF: 12 per cent of basic paid by the employer. Not deducted from your salary. It is an additional cost to the company and part of your CTC.

Gratuity: 4.81 per cent of basic salary. Paid when you leave after 5 years of service. It is an employer cost, not deducted from your pay.

Income Tax on Salary: TDS Calculation

Income tax on salary is deducted at source (TDS) by your employer every month based on your estimated annual tax liability. Your employer asks you to declare expected investments and choose between the old and new tax regime at the start of the financial year.

The calculator above automatically computes your estimated TDS based on the regime you select. Under the new regime for FY 2025-26, salary up to Rs 12,75,000 (after standard deduction of Rs 75,000) is effectively tax-free due to the rebate under Section 87A. Use the Old vs New Tax Regime Calculator for a detailed comparison with all deduction inputs.

Old Regime vs New Regime: Which Gives Higher In-Hand Salary?

The new regime gives higher in-hand salary for most salaried employees with CTC below Rs 15 lakh who do not have significant Section 80C investments or HRA exemption claims. For higher-income employees with full deduction utilization, the old regime often wins.

Old vs New Regime comparison at different salary levels (FY 2025-26, assumptions: 40% basic, no HRA exemption for new, 80C Rs 1.5L for old)
Annual CTC	New Regime Tax	Old Regime Tax (with 80C Rs 1.5L)	Better Regime
Rs 5 LPA	Nil	Nil	Same
Rs 8 LPA	Nil	Nil	Same
Rs 10 LPA	Nil	Rs 2,600	New Regime
Rs 12 LPA	Nil	Rs 11,700	New Regime
Rs 15 LPA	Rs 97,500	Rs 88,400	Old Regime
Rs 20 LPA	Rs 2,38,680	Rs 2,02,800	Old Regime
Rs 30 LPA	Rs 5,07,780	Rs 4,84,500	Old Regime

These figures assume full Rs 1.5 lakh Section 80C utilization for the old regime. If you cannot fully utilize 80C, the new regime threshold for switching rises to Rs 12-13 LPA. Switch the regime toggle in the calculator above to see your specific numbers instantly.

Gratuity in CTC: What It Means for Your Take-Home

Gratuity is a lump sum payment made by the employer when an employee leaves after completing 5 years of continuous service. It is calculated at 15 days of last drawn basic salary for each completed year of service, which works out to approximately 4.81 per cent of basic salary per year.

Since gratuity is an employer cost included in your CTC, it reduces the amount available for your gross salary. Job seekers evaluating offers should look at the gross salary (what they actually earn before deductions) rather than the CTC, as gratuity and employer PF are benefits they receive only at exit or retirement.

8th Pay Commission Salary Calculator

The 8th Pay Commission was constituted by the Union Cabinet in January 2025 to revise the pay structure for approximately 50 lakh central government employees and 65 lakh pensioners, with implementation expected from January 2026. The commission will recommend revised basic pay, allowances, and pension norms.

Previous commissions used a fitment factor to revise basic pay. The 7th Pay Commission, implemented from January 2016, used a fitment factor of 2.57 and raised the minimum basic from Rs 7,000 to Rs 18,000. Once the 8th Pay Commission announces its revised pay levels, central government employees can enter the new basic pay in the calculator above to estimate their revised in-hand salary including DA, HRA, and TA.

Current 7th CPC pay levels with approximate in-hand salary (including DA at current rates, HRA for X-class city)
Pay Level	Entry Basic Pay (7th CPC)	Approx. Monthly In-Hand
Level 1 (Group D)	Rs 18,000	Rs 25,000-28,000
Level 4 (LDC / Postal Asst.)	Rs 25,500	Rs 34,000-39,000
Level 6 (UDC / Steno Grade D)	Rs 35,400	Rs 46,000-53,000
Level 7 (Inspector / ASO)	Rs 44,900	Rs 57,000-66,000
Level 10 (Section Officer)	Rs 56,100	Rs 71,000-84,000
Level 12 (Under Secretary)	Rs 78,800	Rs 96,000-1,12,000
Level 13 (Deputy Secretary)	Rs 1,23,100	Rs 1,48,000-1,70,000

DA and HRA add significantly to the basic pay for central government employees. DA is revised twice a year and is currently around 55 per cent of basic (as of 2025). HRA for X-class cities (Delhi, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad) is 27 per cent of basic.

Salary Breakup for Different CTC Slabs

Typical salary breakup at different CTC levels (monthly), new regime, FY 2025-26
Component	CTC Rs 6 L	CTC Rs 12 L	CTC Rs 25 L
Basic Salary	Rs 20,000	Rs 40,000	Rs 83,333
HRA	Rs 10,000	Rs 20,000	Rs 41,667
Special Allowance	Rs 16,638	Rs 33,276	Rs 69,325
Gross Salary	Rs 46,638	Rs 93,276	Rs 1,94,325
Employee PF (12% of basic)	-Rs 2,400	-Rs 4,800	-Rs 10,000
Professional Tax	-Rs 200	-Rs 200	-Rs 200
Income Tax TDS (New Regime)	Nil	Nil	-Rs 22,900
In-Hand Salary	Rs 44,038	Rs 88,276	Rs 1,61,225

In-Hand Salary for Common Monthly CTC Amounts

The table below shows estimated in-hand salary for common monthly CTC amounts, calculated using 40 per cent basic salary, 12 per cent EPF, and Rs 200 professional tax. Income tax is nil for annual CTC up to Rs 12.75 lakh under the new regime for FY 2025-26, where the full Section 87A rebate applies.

Estimated in-hand salary. Assumes 40% basic, 12% EPF, Rs 200 professional tax, new regime FY 2025-26. Enter your actual CTC in the calculator above for a precise breakup.
Monthly CTC	Annual CTC	Basic/Month	EPF Deduction	Est. Monthly In-Hand
Rs 20,000	2.4 LPA	Rs 8,000	Rs 960	Rs 17,495
Rs 25,000	3 LPA	Rs 10,000	Rs 1,200	Rs 21,919
Rs 28,000	3.36 LPA	Rs 11,200	Rs 1,344	Rs 24,573
Rs 30,000	3.6 LPA	Rs 12,000	Rs 1,440	Rs 26,343
Rs 40,000	4.8 LPA	Rs 16,000	Rs 1,920	Rs 35,190
Rs 50,000	6 LPA	Rs 20,000	Rs 2,400	Rs 44,038
Rs 75,000	9 LPA	Rs 30,000	Rs 3,600	Rs 66,157
Rs 1,00,000	12 LPA	Rs 40,000	Rs 4,800	Rs 88,276
Rs 1,50,000	18 LPA	Rs 60,000	Rs 7,200	Rs 1,21,426
Rs 2,00,000	24 LPA	Rs 80,000	Rs 9,600	Rs 1,55,873

These are estimates. Actual in-hand depends on your exact salary structure, the state you work in (professional tax varies), and whether you choose old or new regime. For salaries above Rs 12.75 lakh annual, income tax applies and reduces in-hand further.

Typical In-Hand Salary by Job Role in India

The table below shows approximate in-hand monthly salary ranges for common job profiles in India, based on average CTC ranges in the industry for 2025. Actual in-hand varies with company structure, city, and tax situation.

Approximate in-hand salary ranges for common roles in India (2025)
Job Role	Experience	Typical CTC (LPA)	Est. Monthly In-Hand
Software Engineer	0-2 years	Rs 4-8 LPA	Rs 28,000-55,000
Software Engineer	3-5 years	Rs 10-18 LPA	Rs 68,000-1,20,000
Data Analyst	0-2 years	Rs 4-7 LPA	Rs 28,000-48,000
Data Scientist	2-5 years	Rs 10-20 LPA	Rs 68,000-1,35,000
Product Manager	2-5 years	Rs 15-30 LPA	Rs 1,00,000-2,00,000
Chartered Accountant	0-2 years	Rs 6-10 LPA	Rs 42,000-68,000
DevOps Engineer	2-4 years	Rs 8-15 LPA	Rs 55,000-1,00,000
Digital Marketing Manager	2-5 years	Rs 6-12 LPA	Rs 42,000-82,000
Machine Learning Engineer	2-5 years	Rs 12-25 LPA	Rs 80,000-1,65,000
Bank PO (SBI)	Entry level	Rs 8-11 LPA	Rs 55,000-75,000
Civil Engineer	2-5 years	Rs 5-10 LPA	Rs 35,000-68,000
Graphic Designer	1-3 years	Rs 3-7 LPA	Rs 22,000-48,000

For the most accurate tax calculation on any of these salary levels, use the Income Tax Calculator to determine exact annual liability and then input the monthly TDS in the calculator above.

How to Use This In-Hand Salary Calculator

Enter your CTC: enter your annual Cost to Company as per your offer letter or latest salary revision.
Adjust components: set your basic salary percentage (typically 40-50 per cent of CTC) and HRA percentage (typically 20-25 per cent of CTC).
Select your tax regime: choose New Regime or Old Regime. The calculator automatically computes your monthly TDS. If you switch regimes, the result updates instantly and shows how much you save vs the other regime.
More settings: click More settings to enter other allowances, employee PF percentage, professional tax, and (for old regime) your Section 80C investments for a more accurate tax estimate.
Review the breakdown: the result panel shows gross salary, individual deductions, auto-calculated TDS, and final in-hand monthly amount.

Click any value in the slider to type a precise number. The currency selector converts all amounts to USD, EUR, GBP, and other currencies for NRI users. Your inputs are saved automatically and restored the next time you visit.

How to Maximize Your Monthly In-Hand Salary

Three practical approaches work for most salaried employees in India. Each targets a different part of the salary structure.

Restructure your salary with tax-free components: Ask HR to include NPS employer contribution (exempt up to 10 per cent of basic salary under Section 80CCD(2)), meal coupons (Rs 2,200/month tax-free), and Leave Travel Allowance (LTA) in your salary structure. These components reduce taxable income without changing your CTC.

Choose the right tax regime every year: Run both regimes in the calculator above before each financial year begins. The new regime is typically better below Rs 12-15 LPA. Above Rs 15 LPA with full 80C and home loan deductions, the old regime saves more. The break-even point shifts as your salary and investments change.

Maximize Section 80CCD(1B) for NPS: Under the old regime, contributing Rs 50,000 to NPS gives an additional deduction over and above the Rs 1.5 lakh Section 80C limit. At the 30 per cent tax slab, this saves Rs 15,600 per year (Rs 1,300/month more in hand). This deduction is available even under the new regime via employer NPS contribution under 80CCD(2).

Request a higher basic salary if you have a home loan: HRA exemption is calculated on basic salary. A higher basic means a higher HRA component and potentially higher HRA exemption under the old regime, which reduces taxable income. This only helps if you live in rented accommodation.

What This Calculator Covers

This calculator addresses the four most common gaps in basic salary estimators. Here is what is supported and what remains out of scope.

Correct CTC-to-gross conversion (supported): Employer PF (12 per cent of basic) and gratuity (4.81 per cent of basic) are subtracted from CTC before computing your gross salary. This typically reduces gross by 6-7 per cent of CTC, making the in-hand estimate significantly more accurate than calculators that treat full CTC as gross.

Variable pay (supported): Use the Variable Pay slider to specify what percentage of your CTC is performance bonus or quarterly incentive. The fixed gross is computed on the remaining CTC, while variable income is included in your annual tax calculation, giving a more accurate TDS estimate.

Old regime deductions (supported): The More Settings panel for the old regime includes Section 80C (up to Rs 1.5 lakh), Section 80D health insurance (up to Rs 25,000), and home loan interest under Section 24b (up to Rs 2 lakh). NPS 80CCD(1B) is not yet a separate slider; enter it under 80C if you wish to approximate.

Perquisite income / ESOP and RSU (supported): Enter your annual perquisite income in More Settings. RSU vesting is taxed as salary in the year of vesting at the fair market value minus exercise price. Enter the expected annual vesting value and the calculator includes it in your annual tax computation.

Frequently Asked Questions

CTC (Cost to Company) is the total amount your employer spends on you annually, including basic salary, HRA, allowances, employer PF, gratuity, bonus, and insurance premiums. Gross salary is the amount you receive before deductions: it includes basic pay, HRA, and all allowances but excludes employer PF and gratuity.

Disclaimer: All calculations on this page are indicative only. Actual in-hand salary depends on your specific salary structure, employer policies, applicable professional tax rates by state, and individual income tax liability under the applicable slab rates for the financial year. Tax calculations are estimates based on standard deductions and the regime selected; they do not account for all exemptions and deductions. This calculator is for educational and planning purposes only and does not constitute financial advice. Consult your HR department or a SEBI-registered financial adviser for precise salary breakdowns and tax planning.