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LoadingMonthly in-hand salary
₹96,200
| Income slab | Rate | Tax |
|---|---|---|
| ₹0 - ₹4,00,000 | 0% | ₹0 |
| ₹4,00,000 - ₹8,00,000 | 5% | ₹20,000 |
| ₹8,00,000 - ₹12,00,000 | 10% | ₹30,340 |
There are two subtractions between the number in your offer letter and the number in your bank account, and most people only know about the second.
That two-step gap is why take-home is typically 25 to 30% below CTC divided by twelve, and why a higher CTC with a worse structure can pay less each month.
| Deduction | How much |
|---|---|
| Employee PF | 12% of basic plus DA, often capped at ₹1,800 under the ₹15,000 wage ceiling |
| Professional tax | Around ₹200 a month, capped at ₹2,500 a year, not levied in every state |
| Income tax (TDS) | Annual tax estimate spread across the months, revised as the year goes |
| ESI | Only if wages are within the eligibility limit |
Professional tax is a state levy. Delhi and Haryana do not charge it at all, so the same CTC pays slightly more in Gurgaon than in Bengaluru.
Two offers with identical CTC can produce different outcomes because of how basic is set:
A basic below about 40% of gross is worth questioning at offer stage. The offer letter traps guide covers the rest of what hides in an annexure.
CTC often includes a performance bonus, a retention bonus or ESOP value. None of those appear in a normal month's credit. Strip them out before comparing offers, and treat a joining bonus at its post-tax value rather than its headline value, since employers usually deduct the full TDS in the month it is paid. Joining bonus and notice buyout tax works through a two-offer comparison.
TDS is the largest of the three deductions for most people, so the regime you declare directly moves your take-home. The new regime wins for most salaried people, and salary up to ₹12.75 lakh pays no income tax at all under it. Check your own numbers in the income tax calculator before declaring.
If you want the answer for a common CTC without entering anything, the in-hand salary pages show the monthly breakdown for each band, from ₹5 LPA through ₹20 LPA and up. Each one shows gross, every deduction and the net monthly figure under the new regime.
CTC (cost to company) is everything the employer spends on you, including employer PF, gratuity and insurance premiums. Gross salary is CTC minus those employer-side costs - the amount that appears as earnings on your payslip. In-hand (take-home) salary is gross minus employee PF, professional tax and TDS.
Because CTC includes components you never see in your bank account: the employer's PF contribution, gratuity provision, and often group insurance premiums. On top of that, employee PF, professional tax and income tax (TDS) are deducted from your gross pay every month.
Employee PF is 12% of basic salary. Many employers apply the statutory wage ceiling of ₹15,000 basic, which caps the deduction at ₹1,800 per month. The employer contributes a matching amount, but that sits inside your CTC rather than being deducted from gross pay.
Professional tax is a state-level tax on salaried income, capped at ₹2,500 per year. Most states that levy it (Maharashtra, Karnataka, West Bengal, Telangana and others) deduct roughly ₹200 per month. A few states like Delhi and Haryana do not levy it at all.
As a rule of thumb, the new regime works out better unless you have large deductions. If your combined deductions (80C, 80D, home loan interest, HRA exemption) are well above ₹4-5 lakh a year, the old regime may win. With the ₹60,000 rebate under the new regime, income up to ₹12 lakh (₹12.75 lakh for salaried with standard deduction) is effectively tax-free in FY 2025-26.
Salaried employees get a flat standard deduction of ₹75,000 under the new regime and ₹50,000 under the old regime. It is applied automatically - no proof or investment is needed.