What is the in-hand salary for a ₹20 LPA package?

A ₹20,00,000 CTC pays roughly ₹1,36,097 a month in hand, taking basic at 40% of CTC, the employer’s provident fund inside the package and professional tax at ₹200 a month. Gross salary is ₹19,04,000, from which come your own provident fund of ₹96,000, new-regime income tax of ₹1,72,432 and ₹2,400 of professional tax.

The breakdown, line by line

Start with CTC of ₹20,00,000 and basic at 40%, which is ₹8,00,000. The employer’s provident-fund contribution is 12% of basic, ₹96,000, and on the usual structure it sits inside the CTC — so gross salary is ₹19,04,000, not ₹20,00,000. That ₹96,000 is yours, but it never appears in your bank account.

Then the deductions from gross. Your own provident fund is the same ₹96,000. Income tax under the FY 2026-27 new regime is ₹1,72,432: taxable income is ₹19,04,000 less the ₹75,000 standard deduction, or ₹18,29,000, giving ₹1,65,800 of slab tax plus ₹6,632 of cess. Professional tax at ₹200 a month is ₹2,400.

In-hand is ₹19,04,000 − ₹96,000 − ₹1,72,432 − ₹2,400 = ₹16,33,168 a year, or ₹1,36,097 a month. That is about 81.7% of CTC reaching you, against roughly 90% on a ₹12,00,000 package — the difference being almost entirely the income tax that starts once taxable income passes the rebate limit.

₹20,00,000 CTC → ₹19,04,000 gross → ₹16,33,168 in hand (₹1,36,097/month)

A bigger basic pay lowers your monthly credit

Provident fund is 12% of basic, not of CTC, so how your package is labelled changes what reaches you even though the package has not changed. On this ₹20,00,000 CTC, basic at 40% gives ₹1,36,097 a month; basic at 50% gives ₹1,32,513.

The ₹3,584 a month between them is not money lost. A higher basic sends more into your provident fund each month and raises the gratuity you would be entitled to on leaving, at the cost of cash now. It also raises the HRA exemption you can reach under the old regime, since two of the three limbs of that rule are measured against basic and DA. Which trade suits you is your call — this page shows the arithmetic on each setting and stops there.

Whether the employer’s provident fund is inside the package

Some offer letters quote CTC with the employer’s contribution included and some quote it on top. It is worth checking, because it is the single largest thing that moves this figure: with the same ₹20,00,000 as gross salary rather than as total cost, in-hand rises to about ₹1,42,433 a month.

That is a ₹6,336 monthly difference between two packages both described as "20 LPA". The number to ask for is gross annual salary, which is the figure every tax and in-hand calculation actually starts from.

What this figure does not include

Variable pay and joining or retention bonuses are excluded — those arrive on their own schedule and are taxed when paid. So are gratuity, which is a statutory entitlement rather than monthly cash, employer contributions to the national pension system, and any insurance premium the employer counts inside the package.

Professional tax is levied by the state and several states do not levy it at all, so the ₹2,400 used here is a common figure rather than a universal one. The tax leg is the new regime with no deductions claimed; if you file under the old regime with real deductions, your monthly deduction changes and so does the take-home.