How CTC to In-Hand Calculation Works
Your CTC (Cost to Company) is the total amount your employer spends on you annually. Your in-hand salary is what actually gets credited to your bank account every month. The gap between the two is usually 15% to 30% depending on your CTC and tax regime.
New Regime vs Old Regime: Which One to Pick
| Situation | Better Regime |
|---|---|
| Salary below Rs. 12.75 LPA, no investments | New Regime (zero tax) |
| Salary Rs. 12.75L to Rs. 15L, minimal deductions | New Regime |
| Salary Rs. 15L+ with 80C maxed, HRA claimed, home loan | Old Regime likely better |
| Salary above Rs. 25L with full deductions | Compare both |
Quick Reference: In-Hand for Common CTC Levels
| Annual CTC | Monthly In-Hand (New Regime) | Annual Tax |
|---|---|---|
| Rs. 6 LPA | ~Rs. 47,800 | Rs. 0 |
| Rs. 8 LPA | ~Rs. 61,500 | Rs. 0 |
| Rs. 10 LPA | ~Rs. 71,100 | Rs. 0 |
| Rs. 12 LPA | ~Rs. 85,400 | Rs. 0 |
| Rs. 15 LPA | ~Rs. 99,200 | ~Rs. 22,100 |
| Rs. 20 LPA | ~Rs. 1,24,500 | ~Rs. 57,200 |
| Rs. 25 LPA | ~Rs. 1,50,000 | ~Rs. 1,02,500 |
Standard PF structure (Rs. 1,800/month), 40% basic, metro city, new regime. Use the calculator above for exact figures.
Frequently Asked Questions
Yes. Under the new regime, the Section 87A rebate wipes out tax on taxable income up to Rs. 12 lakh. After the Rs. 75,000 standard deduction, a gross salary of Rs. 12.75 lakh gives exactly Rs. 12 lakh taxable income -- resulting in zero tax.
Because CTC includes employer contributions that never hit your account -- employer PF (up to Rs. 21,600/year) and gratuity (4.81% of basic). On top of that, employee PF, professional tax, and income tax all reduce your take-home. At higher salaries, the tax component alone can reduce take-home to 65% of CTC.
For most people earning below Rs. 15 LPA without significant deductions, the new regime saves more due to lower slab rates. The old regime works better when your total deductions (80C + 80D + HRA + home loan) exceed roughly Rs. 3.75 lakh at the Rs. 15 LPA bracket. Use the comparison in our calculator to check your exact situation.
Professional tax is a state-level tax deducted by employers. The maximum is Rs. 2,400/year (Rs. 200/month). Not all states levy it -- Karnataka, Maharashtra, Andhra Pradesh, Telangana, and West Bengal are the main ones. Our calculator applies Rs. 2,400 as the standard amount.
Most Indian companies structure basic at 40% to 50% of CTC. A higher basic means higher PF and higher HRA exemption potential under old regime. A lower basic means higher special allowance which is fully taxable. Our calculator defaults to 40% basic, which is the most common structure.