In-Hand Salary Calculator India - CTC to Take Home Salary
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Enter your CTC (Cost to Company) to calculate your actual in-hand salary after all deductions.
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What is CTC (Cost to Company)?
CTC or Cost to Company is the total amount a company spends on an employee in a year. It includes the direct salary, benefits, allowances, bonuses, and other perks. CTC is the package amount mentioned during job offers.
What is In-Hand Salary?
In-hand salary, also known as take-home salary or net salary, is the actual amount you receive in your bank account every month after all deductions. This is typically 65-70% of your CTC.
Components of CTC in India
1. Basic Salary
The core component of your salary, typically 40-50% of CTC. All other components and deductions are calculated based on basic salary.
2. House Rent Allowance (HRA)
Usually 40-50% of basic salary. HRA is partially or fully tax-exempt if you live in rented accommodation.
3. Special Allowances
These include transport allowance, meal allowance, mobile allowance, and other miscellaneous allowances. Usually makes up the remaining portion of monthly salary.
4. Provident Fund (PF)
Employee contributes 12% of basic salary, and employer contributes an equal amount. Your 12% is deducted from salary, while employer's contribution is part of CTC but not your in-hand salary.
5. Gratuity
Calculated as 4.81% of basic salary annually. Payable after 5 years of continuous service. It's part of CTC but not paid monthly.
6. Performance Bonus
Annual or quarterly bonuses based on performance. Part of CTC but paid periodically, not monthly.
7. Insurance & Medical Benefits
Health insurance premiums paid by employer are part of CTC but don't add to your in-hand salary.
8. Other Benefits
Food coupons, gym memberships, stock options, and other perks are part of CTC but may not be direct cash components.
Standard Deductions from Salary
- Employee Provident Fund (EPF): 12% of basic salary
- Professional Tax: ₹200 per month (₹2,400 annually) in most states
- Income Tax (TDS): Deducted based on your tax slab and declarations
- ESI (if applicable): 0.75% of gross salary for employees earning below ₹21,000/month
Formula to Calculate In-Hand Salary
In-Hand Salary = CTC - (PF + Gratuity + Bonuses + Insurance + Professional Tax + Income Tax)
Simplified monthly calculation:
Monthly In-Hand = (Basic + HRA + Allowances) - (PF + Professional Tax + TDS)
Understanding Your Salary Structure
Why is In-Hand Salary Less Than CTC?
The difference between CTC and in-hand salary exists because CTC includes components that are not paid monthly, such as:
- Employer's PF contribution (12% of basic)
- Gratuity (paid after 5 years)
- Insurance premiums paid by employer
- Annual bonuses (paid once or twice a year)
- Stock options or ESOPs
Tips for Salary Negotiation
- Always ask for the detailed salary breakup, not just CTC
- Understand the fixed vs variable component ratio
- Check the basic salary percentage - higher basic means better retirement benefits
- Inquire about performance bonuses and their payout frequency
- Ask about annual increments and appraisal cycles
- Clarify tax deduction policies and reimbursement processes
Comparing Job Offers
When comparing multiple job offers, don't just compare CTC. Consider:
- Actual monthly in-hand salary
- Fixed vs variable pay ratio
- Quality of health insurance coverage
- Leave policy and work-life balance
- Retirement benefits (PF, NPS, gratuity)
- Learning opportunities and career growth
- Job security and company reputation
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Browse JobsFrequently Asked Questions (FAQ)
What is the difference between CTC and in-hand salary?
CTC (Cost to Company) is the total amount a company spends on an employee annually, including salary, benefits, and perks. In-hand salary is the actual amount you receive in your bank account after all deductions like PF, professional tax, and TDS.
How much PF is deducted from salary in India?
Employee Provident Fund (EPF) deduction is 12% of your basic salary. The employer also contributes an equal amount. This is mandatory for companies with 20 or more employees.
What is the average difference between CTC and take-home salary?
Typically, in-hand salary is approximately 65-70% of CTC. The difference of 30-35% includes deductions like PF, gratuity, insurance, bonuses, and other benefits that are part of CTC but not directly paid monthly.
Is gratuity included in CTC?
Yes, gratuity is typically included in CTC. It is calculated as 4.81% of basic salary and is payable when you complete 5 years with the company or on resignation/retirement.
Can I withdraw my PF before retirement?
Yes, you can withdraw PF in specific situations like unemployment for 2+ months, medical emergencies, home purchase, education, or marriage. However, withdrawing before 5 years of continuous service makes it taxable.
What is professional tax in India?
Professional tax is a state-level tax on employment and professions. The maximum limit is ₹2,500 per year. Most states charge ₹200 per month (₹2,400 annually). Some states like Delhi don't have professional tax.