CTC to In-Hand Salary Calculator FY 2026-27 (New & Old Regime)

An offer letter talks in CTC, but rent, EMIs and savings are paid from the amount that lands in your bank account each month. The gap between the two is often 15–30%, and it surprises almost everyone who switches jobs for the first time.

This guide explains what sits inside a CTC, which parts you never receive as cash, how income tax and PF are taken out, and how to read an offer so you know your real monthly pay before you accept it.

What is CTC, and why is it not your salary?

Cost to company (CTC) is everything an employer spends on you in a year. It includes your salary, but also money that goes elsewhere on your behalf, such as the employer's provident fund contribution, gratuity, insurance premiums and performance bonuses that may or may not be paid.

Gross salary is what remains after the employer's own contributions are taken out. In-hand (take-home) salary is gross salary minus your deductions: your PF share, professional tax and income tax (TDS).

Part of CTC	Do you get it as monthly cash?
Basic pay, HRA, special allowance	Yes, after deductions
Employer's PF (12% of basic, often capped at ₹1,800 a month)	No. It goes to your EPF account
Gratuity (usually 4.81% of basic)	No. Paid only if you stay 5+ years
Variable pay or annual bonus	Later, and only if targets are met
Insurance, meal cards, other benefits	Not as salary

How in-hand salary is calculated

The calculator works through the same steps a payroll team does:

Gross salary = CTC − employer PF − gratuity (if included) − variable payTaxable income = gross salary − standard deductionIn-hand = gross salary − employee PF − professional tax − income tax

Provident fund

Both you and your employer put in 12% of basic pay. Many companies cap this at a basic of ₹15,000 a month, so each side pays ₹1,800 a month. Others take 12% of your full basic, which lowers take-home pay but builds a bigger retirement fund. See the EPF calculator for how that grows.

Income tax

Under the new regime for FY 2026-27, salaried people get a ₹75,000 standard deduction, and taxable income up to ₹12 lakh pays no tax because of the rebate. That means a gross salary of up to ₹12.75 lakh can be tax-free. Above that, slab rates from 5% to 30% apply, plus 4% cess. The income tax calculator shows the full slab-by-slab working.

Professional tax

A small state tax, at most ₹2,500 a year. Karnataka, Maharashtra, West Bengal and several other states charge it; Delhi, Haryana and Uttar Pradesh don't.

Worked examples

Example: ₹12 lakh CTC, basic at 50%, PF capped, new regime

Basic pay = ₹6,00,000. Employer PF = ₹1,800 × 12 = ₹21,600.

Gross salary = ₹12,00,000 − ₹21,600 = ₹11,78,400.

Taxable income = ₹11,78,400 − ₹75,000 = ₹11,03,400, which is under ₹12 lakh, so income tax is nil.

In-hand = ₹11,78,400 − ₹21,600 (your PF) − ₹2,400 (professional tax) = ₹11,54,400 a year.

Monthly in-hand: about ₹96,200.

Example: ₹25 lakh CTC, basic at 40%, full PF, gratuity and 10% variable

Basic = ₹10,00,000. Employer PF (12% of basic) = ₹1,20,000. Gratuity at 4.81% = ₹48,100. Variable = ₹2,50,000.

Gross salary for tax (including variable) = ₹23,31,900; taxable after standard deduction = ₹22,56,900.

Income tax with cess = ₹2,74,794 for the year.

Fixed monthly in-hand: about ₹1,42,800, plus around ₹2,20,500 of variable pay after tax if it's paid in full.

The second offer looks twice as large as the first, but the monthly take-home is only about 1.5 times higher. Structure matters as much as the headline number.

How to read an offer letter

Ask for the salary breakup (annexure), not just the CTC. You need basic pay, HRA, allowances, variable pay and benefits listed separately.
Check whether variable pay is guaranteed. Many companies pay 60–100% of it depending on ratings. Treat it as a bonus, not as salary.
Look for one-time items. Joining bonuses, relocation and retention bonuses are often bundled into the first-year CTC. They usually come with a clawback if you leave within a year.
Note the PF basis. Full PF on a high basic can lower take-home pay by several thousand rupees a month.
Compare in-hand, not CTC. Use the job offer comparison calculator to put two offers side by side.

Ways to increase take-home pay

If your company offers a flexible benefits plan, meal cards, phone and internet reimbursements and fuel allowances can be paid against bills.
In the old regime, HRA exemption, Section 80C investments and health insurance cut tax. In the new regime most of these don't apply, so compare both with the old vs new tax regime calculator.
An employer's contribution to NPS for you (up to 14% of basic) is deductible in the new regime too.
Choosing capped PF raises monthly cash, but you save less for retirement. Decide based on whether you'd invest the difference yourself.

How to use this calculator

Enter your annual CTC from the offer letter.
Set basic pay as a share of CTC. If you don't know it, 40–50% is common.
Choose how PF is worked out and whether gratuity is part of your CTC.
Pick your tax regime. The new regime is the default.

FAQs

Why is my in-hand salary so much lower than my CTC?

CTC includes the employer's PF contribution, sometimes gratuity and variable pay, and your own PF, professional tax and income tax are taken out before salary reaches you.

Is income up to ₹12.75 lakh tax-free?

In the new regime, taxable income up to ₹12 lakh pays no tax because of the rebate. With the ₹75,000 standard deduction, a salary of up to ₹12.75 lakh can be tax-free.

Does variable pay come every month?

Usually not. Variable pay or bonuses are paid quarterly or yearly and depend on performance. This calculator shows fixed monthly in-hand and variable pay separately.

What is professional tax?

A small state tax on salaries, up to ₹2,500 a year. Some states, such as Delhi, don't charge it.

Sources

Results are estimates for resident individuals under 60 and aren't tax, legal or financial advice. For your own return, check with a chartered accountant. Spotted a mistake? Tell us.

CTC to in-hand salary calculator