CTC to in-hand salary calculator
Enter your CTC (cost to company) to see what reaches your bank account each month, and why it is less than the offer letter says. Updated for the Income-tax Act, 2025 and the Labour Codes.
FY 2026-27 · rules checked 31 Oct 2026 · estimate, not tax advice. Based on the Finance Act, 2026, the Income-tax Act, 2025 and the Code on Social Security. See the sources.
Monthly in-hand salary
₹42,589
on a CTC of ₹6,00,000 · new tax regime · FY 2026-27
- Yearly in-hand
- ₹5,11,070
- Income tax for the year
- ₹0
- Into your PF (you + employer)
- ₹72,000
| Item | Monthly | Yearly |
|---|---|---|
| CTC | ₹50,000 | ₹6,00,000 |
| Employer PFgoes to your PF account | − ₹3,000 | − ₹36,000 |
| Gratuitypaid when you leave after 5 years | − ₹1,202 | − ₹14,430 |
| Fixed gross salarybasic ₹25,000 a month | ₹45,798 | ₹5,49,570 |
| Employee PF | − ₹3,000 | − ₹36,000 |
| Professional tax | − ₹208 | − ₹2,500 |
| Income tax (TDS) | ₹0 | ₹0 |
| Monthly in-hand | ₹42,589 | ₹5,11,070 |
| Gross salary (fixed + variable) | ₹5,49,570 |
|---|---|
| Standard deduction | − ₹75,000 |
| Taxable income | ₹4,74,570 |
| Tax on slabs | ₹3,729 |
| Rebate (income up to ₹12 lakh) | − ₹3,729 |
| Health & education cess (4%) | ₹0 |
| Total income tax | ₹0 |
What this calculation assumed
- Tax year 2026-27 (1 April 2026 – 31 March 2027), new tax regime (s. 202, the default), resident individual under 60, salary is the only income.
- Basic pay (plus DA) is 50% of CTC. The Labour Codes count allowances above 50% of pay as wages, so most new offers keep basic at 50% or more.
- PF: you and your employer each pay 12% of basic.
- The employer's PF share is part of your CTC, so it is not paid to you.
- Gratuity (4.81% of basic) is part of CTC and paid only when you leave after 5 years (1 year on a fixed-term contract).
- Professional tax: Karnataka. ESI (only when gross pay is ₹21,000 a month or less), NPS, meal cards and other flexible-benefit choices are not modelled.
- New regime: ₹75,000 standard deduction only; HRA and 80C do not reduce tax.
- Tax is spread evenly over 12 months. Figures are rounded to the rupee.
Why your in-hand is lower than your CTC
CTC is everything the company spends on you in a year, not what it pays into your account. These are the usual gaps, with a ₹6 LPA offer as the example:
1.Employer PF is inside your CTC
Most offers count the employer's 12% PF share as part of CTC. It goes to your PF account, not your salary. On a ₹6 LPA offer that is ₹36,000 a year.
2.Your own PF is deducted too
You also pay 12% of basic into PF (₹36,000 a year at ₹6 LPA). It is your savings, with interest, but you cannot spend it each month.
3.Gratuity is paid only when you leave
About 4.81% of basic is set aside as gratuity (₹14,430 a year at ₹6 LPA). You get it after 5 years with the employer, or after 1 year on a fixed-term contract.
4.Variable pay and bonus are not monthly
A performance bonus or variable pay is usually paid once or twice a year, and only if targets are met, so it is not in your monthly in-hand.
5.Professional tax and income tax
States like Karnataka, Maharashtra and Tamil Nadu take up to ₹2,500 a year. Income tax is nil in the new regime until taxable income crosses ₹12 lakh, which is ₹12,75,000 of salary after the ₹75,000 standard deduction.
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Frequently asked questions
What is the in-hand salary for ₹6 LPA?
About ₹42,589 a month in FY 2026-27, if basic is 50% of CTC, PF is 12% of basic and gratuity is part of CTC (Karnataka professional tax, new regime). Income tax is nil because taxable income is under ₹12 lakh.
Is salary up to ₹12 lakh tax-free in the new regime?
Taxable income up to ₹12,00,000 pays no tax because of the rebate under section 156 of the Income-tax Act, 2025 (up to ₹60,000). Salaried people also get a ₹75,000 standard deduction, so a gross salary up to ₹12,75,000 is tax-free. Just above that, marginal relief means you never pay more tax than the income above ₹12 lakh.
Why does my basic pay have to be 50% of CTC now?
The Labour Codes, in force since 21 November 2025, count any allowances above 50% of total pay as wages. Wages decide PF and gratuity, so most employers now set basic (plus DA) at 50% or more. A higher basic means more PF and gratuity, and slightly lower monthly in-hand.
What is the PF wage ceiling in 2026?
₹25,000 a month from 17 September 2026 (it was ₹15,000 since 2014). If your employer caps PF at the ceiling, each side pays at most ₹3,000 a month. Many employers instead pay 12% of the full basic; pick the option that matches your offer.
Should a fresher choose the new or the old tax regime?
For most freshers the new regime gives more in-hand pay: lower slabs, a ₹75,000 standard deduction and no tax up to ₹12 lakh of taxable income. The old regime can win only with large HRA and 80C claims. Switch the regime in the advanced options to compare.
How accurate is this calculator?
It follows the FY 2026-27 rules from the Finance Act, 2026, the Income-tax Act, 2025 and the Code on Social Security, linked below. Your payslip can differ because of ESI, NPS, meal cards, insurance or how your employer splits CTC. It is an estimate, not tax advice.
Sources
Rules checked on 31 Oct 2026. Professional tax follows each state's schedule.
- Finance Act, 2026 (Gazette of India, 30 Mar 2026) — old-regime slabs (Part I-B, Para A), surcharge and its marginal relief (Para F), 4% Health and Education Cess (s. 3)
- Ministry of Finance, Lok Sabha unstarred question 2394 (3 Aug 2026) — new-regime slabs under s. 202, rebate up to ₹12 lakh with marginal relief under s. 156(2), ₹75,000 standard deduction
- Income Tax Department — tax slabs and surcharge (e-filing portal) — both regimes' slabs, ₹60,000 / ₹12,500 rebates, surcharge capped at 25% in the new regime
- Income-tax Act, 2025 as amended by Finance Act, 2026 (incometaxindia.gov.in) — s. 19 standard deduction (₹75,000 new regime, ₹50,000 old regime)
- Ministry of Labour, S.O. 5109(E) (Gazette, 17 Sep 2026) — EPF wage ceiling raised from ₹15,000 to ₹25,000 a month
- Code on Social Security, 2020 — s. 2(88) wages (allowances above 50% count as wages), s. 16 PF at 12%, s. 53 gratuity at 15 days' wages a year
- Ministry of Labour — Compliance handbook for the four Labour Codes — 50% wage rule and gratuity, in plain words