The Salary Calculator converts annual CTC into monthly in-hand salary and compares the old and new income tax regimes side by side for FY 2026-27. Add rent and optional 80C, 80D, NPS and home loan deductions to see which regime saves more. It is an estimate, not tax advice.
- Rules used:
- FY 2026-27 (AY 2027-28)
- Structure assumed:
- Basic 40% of CTC, HRA 50% of basic in metro cities and 40% elsewhere
- PF:
- Employee and employer PF at 12% of basic, capped at ₹21,600 a year each
- Compares:
- Old and new tax regimes side by side
- Not included:
- Bonus or variable pay, and surcharge
How to use the Salary Calculator
- Enter your annual CTC, monthly rent, city type and state.
- Optionally open the deductions section and add 80C, 80D, NPS and home loan interest.
- Read the verdict, the monthly in-hand salary under each regime, and the full breakdown.
CTC is not your in-hand salary
CTC (cost to company) is what your employer spends on you in a year. It includes your gross salary plus the employer's PF contribution and gratuity, which you do not receive monthly. Your in-hand pay is the gross salary minus your own PF, professional tax and income tax.
How this calculator splits your CTC
It assumes basic pay is 40% of CTC, HRA is 50% of basic in a metro or 40% elsewhere, LTA is 5% of CTC, employer PF is 12% of the PF wage ceiling of ₹15,000 a month (₹21,600 a year), and gratuity is 4.81% of basic. Special allowance is whatever remains. Your payslip may be structured differently, so treat the result as an estimate.
Old regime or new regime
The new regime is the default. It has lower slab rates, a ₹75,000 standard deduction and no tax up to ₹12 lakh of taxable income, but almost no other deductions. The old regime allows HRA, 80C, 80D, NPS and home loan interest. The calculator shows both side by side and tells you how much extra deduction the old regime would need to win.
Worked example
At a ₹12 lakh CTC in a metro with ₹15,000 monthly rent and Karnataka professional tax of ₹2,400 a year, the gross salary is about ₹11.55 lakh. The new regime tax is nil, because taxable income is under ₹12 lakh, so the monthly in-hand is about ₹94,300. With no deductions claimed, the old regime leaves about ₹85,400 a month, so the new regime is clearly better in this case.
Common mistakes
Dividing CTC by 12 and expecting that in your bank account, forgetting employer PF and gratuity are inside CTC, ignoring professional tax, and choosing the old regime without adding up the deductions you can actually prove.
What is CTC in salary?
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CTC (Cost to Company) is the total annual cost that an employer incurs for an employee. It includes gross salary, employer PF contribution, gratuity, and other benefits. CTC is always higher than your take-home salary.
How is in-hand salary calculated from CTC?
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In-hand salary = CTC − Employer PF − Employee PF − Professional Tax − Income Tax (TDS). Common deductions include 12% of basic salary to PF from both sides and professional tax up to ₹2,400/year depending on your state.
What is HRA exemption?
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HRA (House Rent Allowance) exemption allows you to reduce taxable income if you live in a rented house. The exemption is the minimum of: (1) Actual HRA received, (2) Rent paid − 10% of basic salary, (3) 50% of basic (metro) or 40% (non-metro).
What is Professional Tax?
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Professional Tax is a state-level tax deducted from salary. Karnataka: ₹200/month (₹150 in Feb). Maharashtra: up to ₹200/month. Not all states levy it — Delhi, Rajasthan, UP do not have professional tax.
What is the standard deduction for salaried employees?
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From FY 2023-24 onward, salaried employees get a standard deduction (₹50,000 in the old regime, ₹75,000 in the new regime from FY 2024-25), which directly reduces their taxable income.
What is the new tax regime vs old tax regime?
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The new tax regime (the default) has lower slab rates and no tax up to ₹12 lakh of taxable income, but allows very few deductions. The old regime allows HRA, 80C, 80D, NPS and home loan interest but has higher rates. Which one is cheaper depends on how much you can deduct, so this calculator shows both side by side and tells you how much extra deduction the old regime needs to win.
What is CTC?
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CTC (Cost to Company) is the total annual cost to the employer — includes gross salary, employer PF, gratuity, and other benefits. Your take-home is typically 40–50% of CTC.
What is standard deduction?
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₹75,000/year in the new regime (₹50,000 in the old regime) for all salaried employees. This directly reduces your taxable income, lowering your tax liability.
New vs old tax regime? Which should I choose?
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It depends on your deductions. With few deductions the new regime usually costs less, and it is tax-free up to ₹12 lakh of taxable income. The old regime tends to win when you claim HRA, 80C, 80D, NPS and home loan interest together. Enter your deductions above to see the exact difference, and compare again every year.
How much deduction do I need for the old regime to beat the new regime?
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There is no single number; it depends on your income. When the new regime is cheaper, this calculator shows how much extra deduction the old regime would need before it wins. Salaried people with high rent plus full 80C, 80D, NPS and home loan interest often find the old regime wins between roughly ₹15 and ₹20 lakh of CTC.
What is the employer PF contribution?
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Employer contributes 12% of basic salary to your Provident Fund (PF) account — it's free money for retirement, not a deduction from your salary.
Why is my in-hand salary so much lower than CTC?
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Employer PF (12%), Employee PF (12%), Professional Tax (up to ₹200/month), and Income Tax (20–30% of taxable income) are the main deductions. Together, they often reduce take-home to 40–55% of CTC.
Can I change my HRA if I move to a different city?
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Yes, HRA changes if your rent changes or you move to a metro/non-metro city. Inform HR with updated rent agreement. This may increase/decrease your take-home salary.
What is gratuity and how does it affect my salary?
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Gratuity (retirement benefit) is usually 4.81% of basic salary (accumulated for 5+ years service). It's part of CTC but paid as a lump sum only at retirement/separation.
Why is my in-hand salary lower than CTC divided by 12?
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Because CTC includes employer PF and gratuity that are not paid to you monthly, and your own PF, professional tax and income tax are deducted from the rest.
Does the calculator include a bonus or variable pay?
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No. The calculator splits your fixed CTC using standard assumptions and does not know how much of it is variable. If part of your CTC is a bonus or variable pay that is paid on performance, your real monthly in-hand salary will differ from the estimate.
Can I change regime every year?
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Salaried employees can choose a regime each year when they file, and tell their employer which one to use for TDS. Check the current rules for your situation.
Free, no sign-up. Reviewed 15 October 2026 by the Gopafy team.
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