Salary Calculator: Calculate In-Hand Salary

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Enter Your Annual CTC

Type the total Cost to Company figure from your offer letter or salary slip into the CTC field, including any fixed bonus or variable pay it already covers, along with your Basic Salary so the calculator can isolate your gross salary correctly.

Select Your Tax Regime and Deductions

Choose between the Old Tax Regime (allows HRA, 80C, and other exemptions) and the New Tax Regime (lower slab rates, Rs 12 lakh zero-tax threshold for FY 2025-26). If you pay rent, enter the monthly rent amount so your HRA exemption is calculated correctly under the old regime. The calculator auto-fills EPF at 12% of basic and professional tax at standard state rates.

Read Your Monthly and Annual Breakdown

The results panel instantly shows your Gross Salary, total deductions (EPF, professional tax, income tax TDS), and your Net Take-Home Salary both monthly and annually. You can toggle between the old and new tax regime to see the side-by-side difference and decide which saves you more money.

Salary estimate logic

Take-home = gross salary - tax - PF - professional tax - other deductions

The live calculator should expose taxable income, deduction assumptions, and regime comparison clearly.

Professional tax and exemptions vary by state and employer policy.

Variable pay, reimbursements, and benefits may not be paid monthly.

Final tax depends on declarations, proofs, and applicable law.

Know before you decide

Why Your CTC and Your Take-Home Are Never the Same Number

A CTC of Rs 10 lakh does not mean Rs 83,333 per month in your account. Employer EPF (12% of basic), gratuity provisioning (4.81% of basic), and benefits like insurance are all inside your CTC but never reach you monthly. Understanding this gap is the first step to negotiating smarter and budgeting more accurately.

New Tax Regime 2025-26: What Has Changed for Salaried Employees

The Union Budget 2025 raised the income tax rebate under Section 87A to Rs 60,000, making income up to Rs 12 lakh effectively tax-free under the new regime. The standard deduction for salaried employees was also increased from Rs 50,000 to Rs 75,000. These changes mean that for most mid-income earners, the new regime is now the default better choice unless HRA and 80C deductions are very large.

HRA Exemption Explained: Metro vs Non-Metro Rules

HRA exemption is the single largest tax-saving lever for salaried employees in rented accommodation. For metro cities (Delhi, Mumbai, Kolkata, Chennai), the exempt amount is 50% of basic salary; for all other cities it is 40%. The actual exemption is capped at the lowest of these three values: actual HRA received, 50%/40% of basic, or rent paid minus 10% of basic, so maximising the exemption requires optimising the rent amount relative to your basic.

EPF and Gratuity: The Long-Term Wealth Components Hidden Inside Your CTC

While EPF and gratuity reduce your monthly take-home, they are compulsory long-term savings. The EPF corpus earns an interest rate set annually by EPFO (8.25% for FY 2023-24) and is tax-free on maturity after 5 years of service. Gratuity of half a month's salary per year of service adds up significantly for employees who stay with one employer for a decade or more.

Salary Structuring Tips to Maximise Your In-Hand Pay Legally

Many employers allow restructuring the salary to increase tax-efficient components: replacing part of special allowance with LTA, food coupons (up to Rs 26,400/year tax-free), or NPS employer contribution (deductible under Section 80CCD(2) even in the new regime up to 14% of basic). Asking your HR to restructure before the financial year begins can save thousands in annual taxes without changing your CTC.

Frequently asked questions

What is a salary calculator and what does it do?

A salary calculator is an online tool that converts your Cost to Company (CTC) figure into your actual in-hand or take-home salary. It factors in all statutory deductions like EPF, professional tax, and income tax, along with allowances such as HRA and LTA, to give you a clear monthly and annual breakdown of what hits your bank account.

What is the formula used to calculate take-home salary in India?

The calculation flows in two steps. First, Gross Salary = CTC minus Employer EPF contribution minus Gratuity. Then, Take-Home Salary = Gross Salary minus Employee EPF contribution minus Professional Tax minus Income Tax (TDS) minus any other deductions. The result is your net in-hand pay.

What is the difference between CTC, Gross Salary, and Take-Home Salary?

CTC (Cost to Company) is the total annual expense a company incurs for an employee, including employer PF contributions, gratuity, and all perks. Gross Salary is what remains after removing employer-side contributions like EPF and gratuity from CTC. Take-Home or Net Salary is the final amount you receive after all employee-side deductions (income tax, employee PF, and professional tax) are subtracted from gross salary.

How much of my CTC is my Basic Salary?

Basic Salary typically ranges between 40% and 50% of your CTC, though the exact proportion is at the employer's discretion. It is the most important component because other calculations such as EPF contributions (12% of basic) and gratuity (15/26 of last basic per year of service) are directly tied to it. A higher basic means higher PF savings but also a higher tax liability.

How is HRA calculated and is it tax-exempt?

HRA (House Rent Allowance) is usually 50% of Basic Salary for employees in metro cities (Delhi, Mumbai, Kolkata, Chennai) and 40% for those in non-metro cities. Under the old tax regime, you can claim HRA exemption as the lowest of: actual HRA received, rent paid minus 10% of basic salary, or 50%/40% of basic salary. HRA exemption is not available under the new tax regime introduced from FY 2020-21 onwards.

What is the EPF deduction and how is it calculated?

Both the employee and employer contribute 12% of the employee's Basic Salary towards the Employee Provident Fund (EPF). The employee's 12% share is deducted from the gross salary and is reflected in the take-home reduction. The employer's 12% share is part of the CTC but does not reach the employee's bank account; only the accumulated corpus is available at retirement, resignation after 5 years, or on specific EPFO-approved grounds.

What is Professional Tax and who deducts it?

Professional Tax is a state-level tax levied on salaried individuals. The maximum amount is capped at Rs 2,500 per year by the Constitution of India. Most states charge around Rs 200 per month for individuals earning above Rs 7,500 per month, though the exact slab varies by state. It is deducted by the employer from your gross salary and remitted to the state government on your behalf.

Should I choose the Old Tax Regime or New Tax Regime for FY 2025-26?

Under the New Tax Regime (FY 2025-26), no income tax is payable on income up to Rs 12 lakh due to the enhanced rebate under Section 87A. The standard deduction has also been raised to Rs 75,000 for salaried employees. The Old Tax Regime is still worth considering if your total exemptions and deductions under HRA, 80C, 80D, and NPS exceed roughly Rs 4-5 lakh, making it tax-efficient to stay. Use the calculator to compare both regimes with your actual numbers.

What is Gratuity and when do I receive it?

Gratuity is a statutory lump-sum payment an employer makes to an employee as a reward for long service. The formula is: Gratuity = (Last Basic Salary / 26) x 15 x Number of Years Served. Eligibility requires a minimum of 5 continuous years of service with the same employer. Exceptions exist for death or permanent disability, where it is payable regardless of years served. Gratuity is included in your CTC but is not part of your monthly take-home.

What inputs do I need to use the Kiwi Salary Calculator?

You need three primary inputs: your annual CTC (from your offer letter), any bonus amount or percentage included in the CTC, and your tax regime preference (old or new). Optionally, you can add your actual rent paid (for HRA calculation), any additional deductions, and employer NPS contributions. The calculator handles EPF, professional tax, and gratuity automatically using standard rates.

Why does my actual salary slip not match the salary calculator output?

Small discrepancies are common because salary calculators use standard statutory rates and round figures. Your actual slip may reflect company-specific policies on HRA structuring, a different basic-to-CTC ratio, variable bonus amounts, state-specific professional tax slabs, or employer-side NPS contributions that differ from defaults. Use the custom deduction fields in the calculator to match your actual slip more precisely.

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