ⓘResults are estimates based on the figures you enter and standard formulas. They are for information only and are not financial, investment, tax or legal advice. Rates and rules change, so confirm with your bank, fund house, employer or tax adviser before you decide. Read the full disclaimer.
How CTC becomes take-home pay
CTC is everything your employer spends on you in a year.
Subtract the employer’s PF (12% of basic) and gratuity (about 4.81% of basic) if they are part of CTC. That leaves your gross salary.
Subtract your own PF (also 12% of basic), professional tax and income tax.
What remains, divided by 12, is your monthly in-hand salary.
In-hand salary for common CTCs
New tax regime, basic pay 50% of CTC, PF at 12% of basic, gratuity included in CTC and ₹2,400 professional tax.
Monthly in-hand salary for common CTCs
Annual CTC
Income tax / year
In-hand / month
₹5,00,000
₹0
₹35,465
₹8,00,000
₹0
₹56,864
₹10,00,000
₹0
₹71,130
₹12,00,000
₹0
₹85,396
₹15,00,000
₹77,835
₹1,00,309
₹20,00,000
₹1,57,440
₹1,29,340
₹30,00,000
₹3,97,140
₹1,80,695
₹50,00,000
₹9,68,700
₹2,75,726
Salary components explained
Basic pay: the base of your salary. PF and gratuity are calculated on it. Under the new labour codes, wages (basic plus DA) generally need to be at least half of total pay.
Provident Fund: you and your employer each put 12% of basic into your EPF account. Some employers cap it at 12% of ₹15,000 (₹1,800 a month).
Gratuity: paid when you leave after 5 or more years of service; many companies show it inside CTC.
Professional tax: a small state tax, up to ₹2,500 a year.
Income tax: calculated on your gross salary after the standard deduction (₹75,000 in the new regime).
HRA, special allowance and other allowances are all part of gross salary; they change only the old-regime tax (through the HRA exemption). Compare regimes in detail with the income tax calculator.
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Frequently asked questions
What is the in-hand salary for ₹12 lakh CTC?+
With basic pay at 50% of CTC, PF at 12% of basic, gratuity included in CTC and ₹2,400 professional tax, a ₹12 lakh CTC gives about ₹85,396 a month under the new regime, with no income tax. Your exact figure depends on your salary structure.
Why is my in-hand salary so much lower than my CTC?+
CTC includes things that never reach your bank account every month: the employer’s PF contribution, gratuity, and sometimes insurance or bonuses. From the rest, your own PF, professional tax and income tax are deducted.
What is the difference between CTC, gross and net salary?+
CTC is the total cost to your employer. Gross salary is CTC minus the employer’s PF and gratuity. Net (in-hand) salary is gross minus your PF, professional tax and income tax.
Can I increase my in-hand salary?+
You can opt for PF on the ₹15,000 wage ceiling instead of full basic (if your employer allows), pick the cheaper tax regime, and in the old regime claim HRA, 80C and 80D. Note that lowering PF reduces your retirement savings.