What is the in-hand salary for a ₹12 LPA package?
A ₹12,00,000 CTC pays roughly ₹87,800 a month in hand, taking basic at 40% of CTC, provident fund on half the package under the Code on Social Security's wages rule, and professional tax at ₹200 a month. Income tax is nil: gross salary is ₹11,28,000 and taxable income falls under the ₹12,00,000 rebate limit. The deductions are your own PF of ₹72,000 and professional tax of ₹2,400 a year.
Try it on your numbers in the CTC to in-hand calculatorThe breakdown, line by line
Start with CTC of ₹12,00,000, basic at 40% (₹4,80,000) and the employer's PF inside CTC. Provident fund does not run on that basic alone: under the Code on Social Security, allowances beyond half of pay count as wages, so PF wages are half the package, ₹6,00,000. The employer's 12% is ₹72,000, which leaves a gross salary of ₹11,28,000.
Now the deductions from gross. Your own PF is the same ₹72,000. Income tax under the FY 2026-27 new regime is nil — taxable income is ₹11,28,000 minus the ₹75,000 standard deduction, or ₹10,53,000, comfortably under the ₹12,00,000 limit at which Section 87A gives a full rebate. Professional tax at ₹200 a month is ₹2,400.
In-hand is ₹11,28,000 − ₹72,000 − ₹2,400 = ₹10,53,600 a year, or ₹87,800 a month. That is 87.8% of CTC reaching you, which is about as high as the ratio gets — this package sits just under the point where income tax starts.
Why the tax is zero, and where it stops being zero
Under FY 2026-27 new-regime rules, Section 87A gives a full rebate when taxable income is ₹12,00,000 or less. With the ₹75,000 standard deduction, that means gross salary up to ₹12,75,000 pays no income tax at all.
Working backwards through the PF step, at 40% basic a CTC of roughly ₹13,56,000 produces exactly that ₹12,75,000 gross. Below it, nil. Just above it, marginal relief keeps the tax small rather than a cliff — at ₹13,60,000 CTC the annual tax is ₹3,536. The real jump comes later: by ₹15,00,000 CTC the tax is ₹83,460.
Why the basic percentage mostly no longer moves the answer
Provident fund used to follow basic alone, so the share of a package labelled basic moved the monthly credit. Under the Code on Social Security, in force since 21 November 2025, PF runs on wages — basic, dearness allowance and retaining allowance — and where the other allowances add up to more than half of pay, the excess counts as wages too. The effect is that PF wages never fall below half the package.
So on this ₹12,00,000 CTC, basic at 30%, 40% or 50% all give the same ₹87,800 a month. Only a basic above half changes it: at 60% it is ₹85,400, and the ₹2,400 difference is not lost — it goes into EPF and raises the gratuity you would be entitled to on leaving. The setting that still moves the figure a lot is whether your employer caps PF at the ₹25,000 wage ceiling, which the calculator has a switch for.
The same maths across other packages
At basic 40%, employer PF inside CTC and ₹200 a month of professional tax, the monthly in-hand ladder runs: ₹6 LPA → ₹43,800. ₹8 LPA → ₹58,467. ₹10 LPA → ₹73,133. ₹12 LPA → ₹87,800. ₹15 LPA → ₹1,02,845. ₹20 LPA → ₹1,32,513. ₹25 LPA → ₹1,59,842.
Notice what happens between ₹12 LPA and ₹15 LPA: CTC rises 25% but monthly in-hand rises only 17%, because income tax appears in that gap. The share of CTC reaching you falls from 87.8% at ₹12 LPA to 82.3% at ₹15 LPA and 76.7% at ₹25 LPA. Every one of these figures assumes the new regime and no variable pay; a basic above half the package, a PF cap or a different state moves them.
CTC to in-hand
Questions people ask
What is the in-hand salary for 12 LPA?
About ₹87,800 a month, with basic at 40% of CTC and professional tax of ₹200 a month. Income tax is nil under the FY 2026-27 new regime, so the only deductions are your own PF of ₹72,000 a year and professional tax.
Do I pay income tax on a ₹12 lakh CTC?
Not under the new regime. Gross salary of ₹11,28,000 less the ₹75,000 standard deduction leaves ₹10,53,000 of taxable income, below the ₹12,00,000 limit at which Section 87A gives a full rebate. TDS should be nil.
At what CTC does income tax start under the new regime?
Gross salary above ₹12,75,000 starts attracting tax, which at 40% basic corresponds to a CTC of roughly ₹13,56,000. Marginal relief keeps the amount small just above the line — ₹3,536 a year at ₹13,60,000 CTC.
Why is my 12 LPA in-hand less than ₹87,800?
Usual causes are a basic above half the package raising the PF deduction, variable pay counted inside the ₹12 lakh but paid annually, employer NPS or insurance inside CTC, or professional tax higher than ₹200 in your state.
Is 12 LPA a good salary in India?
That depends on your costs rather than the number. A more useful question is how many months of your own expenses it covers and what it leaves over monthly — which the free calculator on the Muktify home page works out from figures you enter.
How much PF is deducted on a ₹12 lakh package?
With basic at 40% of CTC, basic is ₹4,80,000 — under half the package, so PF runs on ₹6,00,000 under the Code on Social Security's wages rule. Your own contribution at 12% is ₹72,000 a year or ₹6,000 a month, and your employer contributes the same from inside your CTC. Where PF is capped at the ₹25,000 wage ceiling it is ₹3,000 a month each.
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Try it nowLast updated 28 September 2026. Figures reflect FY 2026-27 and are educational estimates, not advice. Muktify is not SEBI-registered and never recommends or ranks any instrument. How we write and check guides.