What is the difference between CTC and In-Hand salary?

CTC (Cost to Company) is the total annual cost incurred by the employer, including employer EPF, gratuity, and health insurance. In-hand salary is the actual net amount credited to your bank account after deducting non-cash benefits, employee EPF, professional tax, and income tax (TDS).

How much percentage of CTC is received as monthly in-hand salary?

In India, monthly in-hand salary is typically 70% to 85% of annual CTC divided by 12, depending on variable bonuses, employer retirals, and applicable income tax slabs.

Is employer EPF part of CTC in India?

Yes, most corporate CTC offers in India include the employer EPF contribution (12% of basic pay) as part of the total annual CTC package.

What is the ideal Basic Salary percentage in CTC?

Under the Code on Wages guidelines, Basic Salary + DA typically constitutes 40% to 50% of CTC. A higher basic increases retirement benefits (EPF, Gratuity) while a lower basic increases immediate monthly take-home.

Is Gratuity legally deductible from my CTC?

While Gratuity is paid by the employer under the Payment of Gratuity Act 1972 after 5 years of service, Indian corporate offer letters commonly structure it as a cost component (4.81% of Basic) inside the annual CTC.

How does New Tax Regime impact CTC take-home salary?

Under the New Tax Regime (Section 115BAC), lower tax slab rates apply and income up to ₹12.75 Lakhs is effectively tax-free with standard deduction (₹75k) and rebate (87A), resulting in higher monthly take-home for most employees without requiring 80C/80D investments.

CTC Calculator (Cost to Company to In-Hand) 2026

Convert annual Cost to Company (CTC) into exact monthly take-home salary, gross pay, employer retirals, and tax deductions.

Enter CTC Package Details

Annual CTC Offer (₹)

₹3 Lakhs₹50 Lakhs₹1 Crore

Basic Pay (% of CTC)Typically 40% to 50% of CTC in Indian corporate offers.50% (₹6.00 L/yr)

Employer EPF (12%) in CTCGratuity (4.81%) in CTC

Employer NPS (% of Basic)0%

Annual Health Insurance Premium (₹)

Annual Variable / Performance Bonus (₹)

Select Income Tax Regime

Net Monthly In-Hand Take-Home

₹84,563/ Monthly (₹)

Annual In-Hand Take-Home: ₹10.15 L (84.6% Take-Home % of CTC)

Gross Monthly Salary₹90,763/mo₹10.89 L/yr

Income Tax (TDS)₹0Zero tax (Sec 87A)

Employee EPF (12% of Basic):-₹6,000/mo

Professional Tax (PT):-₹200/mo

Employer Retirals & Deductions Breakdown:₹8,404/mo

Monthly & Annual CTC Breakup Schedule

Cost Component	Cost Component	Monthly (₹)	Annual (₹)
Basic Salary	Gross Salary (A)	₹50,000	₹6.00 L
HRA (House Rent Allowance)	Gross Salary (A)	₹25,000	₹3.00 L
Special / Other Allowances	Gross Salary (A)	₹15,763	₹1.89 L
Employer EPF (12%)	Total Employer Retirals & Benefits (B)	₹6,000	₹72,000
Gratuity Contribution	Total Employer Retirals & Benefits (B)	₹2,404	₹28,846
Health Insurance (Employer Paid)	Health Insurance (Employer Paid)	₹833	₹10,000
Employee EPF (12% of Basic)	Total Employee Deductions (C)	-₹6,000	-₹72,000
Professional Tax (PT)	Total Employee Deductions (C)	-₹200	-₹2,400
Income Tax (TDS)	Total Employee Deductions (C)	₹-0	₹-0
Net Monthly In-Hand Take-Home		₹84,563	₹10.15 L

About CTC (Cost to Company) Structure in India

Cost to Company (CTC) represents the total expenditure an employer incurs on an employee annually. It is divided into direct benefits (Gross Salary), indirect benefits (Employer EPF, Gratuity, Health Insurance), and variable components (Performance Bonus).

Official Sources & Regulatory Guidelines

Income Tax Department, Government of India: incometaxindia.gov.in
Employees’ Provident Fund Organisation (EPFO): epfindia.gov.in

CTC Breakdown & In-Hand Salary FAQs

CTC includes employer contributions like EPF (12%), Gratuity (4.81%), group insurance, and variable bonus. Additionally, income tax TDS, employee EPF, and professional tax are deducted from Gross Pay before your bank credit.

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