Salary Calculator: CTC to In-Hand Salary

CTC vs gross salary vs in-hand salary

Three figures describe the same job, and they are rarely the same number:

• CTC (cost to company) is everything your employer spends on you in a year, including amounts you never receive as monthly pay.
• Gross salary is CTC minus employer-side costs such as employer PF and gratuity. It is the total of the earnings lines on your payslip.
• In-hand (take-home) salary is gross salary minus employee PF, professional tax, income tax (TDS) and any other deductions. It is what is credited to your bank account.

Gross salary = CTC − employer PF − gratuity (if in CTC)

In-hand salary = gross salary − employee PF − professional tax − income tax − other deductions

Components of CTC

Basic salary

Basic is the fixed core of your pay, usually 40–50% of CTC. Many other components are worked out from it, so a higher basic raises PF and gratuity and leaves less room for allowances.

House rent allowance (HRA)

HRA is commonly 40–50% of basic. It is fully taxable in the new regime. In the old regime, part of it can be exempt if you pay rent; the exempt amount depends on rent paid, basic salary and your city, so enter the figure from your employer's tax computation.

Special allowance

Special allowance is the balancing figure: whatever remains of gross salary after basic and HRA. It is fully taxable.

Employer PF contribution

Your employer contributes 12% of basic wages to your EPF account (part of this goes to the pension scheme). The statutory minimum is on wages up to ₹15,000 a month, which is ₹1,800 a month, but many employers contribute on full basic. When employer PF is shown inside CTC, it reduces your gross salary.

Gratuity

Some employers show gratuity in CTC, typically at 4.81% of basic. It is paid only when you leave after completing the qualifying service period, so it is not part of your monthly salary.

Deductions from your salary

• Employee PF: 12% of basic (or of basic up to ₹15,000 a month) goes from your salary to your EPF account. It is savings, not a cost, but it reduces take-home.
• Professional tax: a state tax on employment, up to ₹2,500 a year. The amount and slabs vary by state, and some states do not levy it.
• Income tax (TDS): your employer estimates your tax for the year and deducts it monthly. This calculator spreads it evenly over 12 months.

How income tax is estimated

The calculator applies the slab rates for FY 2026-27 (AY 2027-28) for a resident individual below 60, last verified on 6 October 2026. Tax rules change each year, so check the tax year shown above against the year you are planning for.

New regime slabs (default)

Salaried people get a standard deduction of ₹75,000. Professional tax, HRA exemption and deductions such as 80C and 80D are not allowed in the new regime.

Old regime slabs

The old regime has a ₹50,000 standard deduction and allows professional tax, HRA exemption, 80C (up to ₹1,50,000 including your employee PF), 80D and other eligible deductions.

Rebate and marginal relief

Under the section 87A rebate, tax is nil in the new regime if taxable income is ₹12,00,000 or less (rebate up to ₹60,000), and in the old regime if it is ₹5,00,000 or less (rebate up to ₹12,500).

In the new regime, marginal relief applies just above ₹12 lakh: tax before cess cannot exceed the income above ₹12,00,000. For example, at a taxable income of ₹12,10,000, slab tax would be ₹61,500, but it is limited to ₹10,000. Adding 4% cess gives ₹10,400 instead of ₹63,960. This relief stops mattering at about ₹12,70,600 of taxable income, where slab tax falls below the income above ₹12 lakh. The old regime has no such relief.

Surcharge and cess

A surcharge is added to income tax when taxable income exceeds ₹50 lakh (10%), ₹1 crore (15%) and ₹2 crore (25%). In the old regime only, it rises to 37% above ₹5 crore; the new regime caps it at 25%. Marginal relief applies at each threshold, so crossing it by a small amount cannot raise tax plus surcharge by more than the extra income. Finally, 4% Health and Education Cess is charged on tax plus surcharge.

New regime vs old regime

Neither regime is better for everyone. The new regime has lower rates, a higher standard deduction and a larger rebate. The old regime has higher rates but lets you reduce taxable income with HRA exemption, 80C, 80D and other deductions. If those deductions are small, the new regime usually leaves you with more; if they are large, the old regime may. The comparison table under the calculator shows both on your own inputs.

Worked example: ₹12 lakh CTC

Using the calculator's default inputs: basic 40% of CTC, HRA 50% of basic, employer and employee PF at 12% of basic, no gratuity in CTC, ₹2,400 professional tax and no other deductions.

Tax under the new regime: taxable income = ₹11,42,400 − ₹75,000 = ₹10,67,400. Slab tax is ₹20,000 + 10% of ₹2,67,400 = ₹46,740, which the rebate cancels because taxable income is below ₹12 lakh.

Tax under the old regime, with no deductions beyond PF: taxable income = ₹11,42,400 − ₹50,000 standard deduction − ₹2,400 professional tax − ₹57,600 employee PF under 80C = ₹10,32,400. Tax = ₹12,500 + ₹1,00,000 + 30% of ₹32,400 = ₹1,22,220, plus 4% cess = ₹1,27,109. Monthly take-home would be about ₹79,608, so on these inputs the new regime leaves about ₹10,592 a month more.

Take-home at common CTC levels

Same structure as the worked example, new regime:

Once you know your monthly take-home, you can check how much home loan a lender may offer with the home loan eligibility calculator, work out a comfortable property budget with the home affordability calculator, or see what a monthly investment from your salary could grow to with the SIP calculator.

Why your payslip may differ

• Your employer may split CTC differently, with components such as LTA, meal cards, fuel or telephone reimbursements.
• Variable pay, bonuses and joining bonuses are often in CTC but paid once a year or on conditions.
• Employer insurance premiums, NPS contributions and other benefits may be included in CTC.
• Your employer recalculates TDS during the year based on the regime you choose and the proofs you submit, so monthly TDS is rarely identical every month.
• Professional tax is deducted on state-specific slabs, sometimes with a higher amount in one month.
• Other income, such as interest, rent or capital gains, changes your total tax but is not included here.