From CTC to what actually reaches your bank
Cost to Company is what your employer spends, not what you receive. Several components never reach your account: the employer’s EPF contribution, gratuity accrual, and any insurance premium the company pays are all inside CTC but are not take-home pay.
From the gross that remains, three further deductions apply — your own EPF contribution, income tax deducted at source, and professional tax where your state levies it. What is left is your in-hand salary.
In-hand = CTC − employer PF − employee PF − income tax − professional tax
Why the basic percentage matters
EPF is calculated as 12% of basic salary from both you and your employer, so the share of your CTC structured as basic directly changes your take-home. A higher basic means more goes into EPF — reducing in-hand pay today while increasing retirement savings and gratuity entitlement.
This is why two people on identical CTC can receive noticeably different monthly amounts. The calculator lets you set the basic percentage rather than assuming one.
What this calculator assumes
Tax is computed under the new regime, the default since FY 2023-24, using the FY 2025-26 slabs and the ₹75,000 standard deduction. If you claim significant deductions under the old regime, use the Old vs New Tax Regime calculator to compare first.
EPF is modelled at 12% of full basic for both sides, without the ₹15,000 wage-ceiling variant. Professional tax is entered by you because it varies by state — ₹200 a month is typical. Gratuity accrual, ESI, NPS, variable pay and perks are not modelled.
How do I calculate in-hand salary from CTC?+
Start from CTC, remove the employer’s EPF contribution and any other employer-paid components to get gross salary, then subtract your own EPF contribution, income tax and professional tax. What remains is monthly in-hand pay.
Why is my in-hand salary so much lower than my CTC?+
CTC includes costs that never reach you — the employer’s EPF share, gratuity accrual and insurance premiums — and your gross is then reduced by your own EPF, TDS and professional tax. The gap is often 20–30% of CTC.
How much EPF is deducted from salary?+
Typically 12% of basic salary from you, matched by 12% from your employer. Because it is a percentage of basic rather than of CTC, the way your salary is structured changes the deduction.
Does a higher basic salary mean lower take-home pay?+
Usually yes, in the short term. A higher basic increases the 12% EPF deduction, lowering monthly in-hand pay, while increasing your EPF balance and gratuity entitlement.
What is professional tax and why does it vary?+
It is a state-level tax on employment, so the amount and whether it applies at all depend on your state. Around ₹200 a month is common where it is levied, which is why the calculator asks rather than assumes.
Which tax regime does this calculator use?+
The new regime, using FY 2025-26 slabs and the ₹75,000 standard deduction. If you have substantial 80C, 80D, HRA or home-loan deductions, compare both regimes first using the Old vs New Tax Regime calculator.
What is the difference between CTC, gross salary and in-hand salary?+
CTC is everything your employer spends on you, including their EPF contribution and gratuity accrual. Gross salary is what is actually payable to you before deductions. In-hand is what lands in your account after your own EPF, income tax and professional tax. Each number is smaller than the one before it.
Why did my in-hand salary fall after a raise?+
Usually because the raise moved you into a higher slab or changed your salary structure. A higher basic increases the 12% EPF deduction, and a mid-year revision can also cause TDS to be recalculated across the remaining months, temporarily deducting more to catch up.
Is variable pay or bonus included in in-hand salary?+
Not in this calculator. Variable pay, performance bonuses and perks are excluded because they are neither guaranteed nor paid monthly. Your CTC letter usually includes them, which is a common reason the advertised figure and the monthly credit feel so far apart.
What is the difference between EPF and gratuity?+
EPF is a monthly contribution — 12% of basic from you and typically the same from your employer — that builds a balance you can carry between jobs. Gratuity is paid by the employer only when you leave, generally after five years of service, and is calculated from your last-drawn basic plus DA rather than accumulated monthly.