Verified · 30 Sept 2026
Salary Calculator – CTC to In-Hand (Labour Code)
Enter a CTC to see the monthly in-hand salary after PF, ESI, professional tax and income tax, and check that the structure meets the 50% wage rule.
✓ Verified against official notifications · 30 Sept 2026 · How we verify →
Recent change: Central Rules under all four Labour Codes notified (8 May 2026)
Cost to company per year, including employer PF and any variable pay.
Employee and employer PF of ₹3,000 each. Untick if PF is on full wages.
Many employers show 4.81% of basic as gratuity in the CTC.
Monthly in-hand
₹85,388
Annual in-hand
₹10,24,654
Gross salary / month
₹91,596
₹6,208 deducted
50% wage rule met
Monthly salary slip
- Basic + DA₹50,000
- House Rent Allowance (HRA)₹20,000
- Special allowance₹21,596
- Gross salary₹91,596
- Employee PF (12%)− ₹6,000
- Professional tax− ₹208
- Monthly in-hand₹85,388
Also in your CTC
- Employer PF (12%)₹6,000
- Gratuity provision₹2,404
- CTC per month₹1,00,000
Taxable income ₹10,24,154 · annual income tax ₹0 (incl. cess)
- Income tax uses the new regime for FY 2026-27: ₹75,000 standard deduction and no tax up to ₹12 lakh taxable income. The old regime may suit you if you claim large deductions (80C, HRA, home loan).
- Gratuity is part of CTC but paid only on exit, after 5 years (1 year for fixed-term staff).
4 Codes in force 21 Nov 2025 · Central Rules 8 May 2026 (G.S.R. 342–344(E))Verify on EPFO / ESIC →Share on WhatsApp
For estimation only. This calculator applies the rules as we understand them on 30 Sept 2026. It is not legal or tax advice. Verify with the official notification or consult a Chartered Accountant / labour-law professional before filing or changing payroll.
Did this tool give you the right answer?
From CTC to the amount in your bank
CTC is the employer's total yearly cost for you. Some of it never reaches your account: the employer's PF contribution, the gratuity provision, and employer ESI where it applies. What remains is gross salary. Take away employee PF, employee ESI, professional tax and income tax, and you have the monthly in-hand figure.
Worked example: ₹12 lakh CTC in Bengaluru
Basic is 40% of CTC, HRA is half of basic, PF is paid on the ₹25,000 ceiling and gratuity is shown inside CTC. The calculator settles the special allowance so that everything adds back to ₹1,00,000 a month.
| Monthly | Amount |
|---|---|
| Basic | ₹40,000 |
| HRA | ₹20,000 |
| Special allowance | ₹34,723 |
| Gross salary | ₹94,723 |
| Employer PF (in CTC, not paid to you) | ₹3,000 |
| Gratuity provision (in CTC, paid on exit) | ₹2,277 |
| Less: employee PF | −₹3,000 |
| Less: Karnataka professional tax (₹2,500 a year) | −₹208 |
| Less: income tax | ₹0 |
| In-hand | ₹91,515 |
Income tax is nil because taxable income is ₹11.37 lakh of gross pay less the ₹75,000 standard deduction, which is ₹10.62 lakh. That is under the ₹12 lakh rebate limit of the new regime.
At ₹18 lakh CTC on the same structure, gross is ₹1,43,549 a month. Taxable income is ₹16.48 lakh, income tax with cess is ₹1,34,699 a year (₹11,225 a month), and in-hand is ₹1,29,116.
These figures use the ₹25,000 PF wage ceiling in force from 17 September 2026. Before that date the ceiling was ₹15,000 and PF on it was ₹1,800 a month on each side. The same ₹12 lakh offer then gave ₹93,887 in hand, ₹2,372 more, because both the employee's PF and the employer's PF, which comes out of the same CTC, were ₹1,200 lower.
Why a 40% basic trips the 50% wage rule
The Labour Codes measure wages against total pay, not CTC. In the ₹12 lakh example basic is ₹40,000 of ₹94,723 gross, only 42.2%. HRA and the special allowance make up the other 57.8%. The excess over half, ₹7,362, is added back, so Code wages are ₹47,362.
Because PF is capped at ₹25,000, the add-back does not change PF here. It raises the gratuity provision instead, since gratuity is 15/26 of a month's wages per year, or about 4.81% of wages each month. Untick the PF ceiling and in-hand falls to ₹86,504, a drop of ₹5,011 a month. Employee PF rises to ₹5,535, and because CTC is fixed, the higher employer PF comes out of the special allowance as well.
The ₹12 lakh cliff and marginal relief
The rebate wipes out tax up to ₹12 lakh of taxable income. Just above that, marginal relief stops tax from exceeding the income over ₹12 lakh. At ₹12.1 lakh, tax is ₹10,000 plus cess, or ₹10,400, not the ₹61,500 the slabs alone would give. By ₹13 lakh relief has run out and tax is ₹78,000.
| Taxable income | Tax with 4% cess |
|---|---|
| ₹12,00,000 | ₹0 |
| ₹12,10,000 | ₹10,400 |
| ₹13,00,000 | ₹78,000 |
What the calculator assumes
- The new tax regime, where only the standard deduction applies. The old regime can still win if you claim large HRA, 80C and home loan deductions.
- Variable pay is taxed evenly across the year, though it is paid when earned.
- ESI applies only while gross pay is ₹21,000 a month or less.
- Professional tax follows your state's slabs. See the state-wise PT table, or check the wage split in the 50% wage rule calculator.
Official sources
Frequently asked questions
What is the difference between CTC and in-hand salary?
CTC is everything the employer spends on you in a year, including employer PF, gratuity and variable pay. In-hand salary is what reaches your bank account each month after employee PF, ESI, professional tax and income tax.
How do the new Labour Codes change in-hand salary?
If basic pay is under half of total pay, the excess allowances are added back to wages. That raises PF and gratuity, which can lower monthly take-home even though CTC stays the same.
How much tax is payable on a ₹12 lakh salary?
Under the new regime, salary income up to ₹12.75 lakh (₹12 lakh after the ₹75,000 standard deduction) pays no income tax because of the rebate under section 156 of the Income-tax Act, 2025 (section 87A of the old Act).
Is employer PF part of my in-hand salary?
No. The employer's 12% PF is part of your CTC, but you don't get it in your monthly pay. Of it, 8.33% of wages up to the PF wage ceiling goes to the Employees' Pension Scheme (EPS), and the rest goes to your PF account.