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CTC (Cost to Company) is everything your employer spends on you in a year — your salary components plus their own contributions like Provident Fund and gratuity provisioning. Your in-hand (take-home) salary is what actually lands in your bank account each month, after your own PF contribution, professional tax, and income tax are deducted. The gap between the two surprises most first-time earners.
There is no law mandating a fixed Basic-to-CTC ratio or a standard set of allowances — each company designs its own structure. Most private-sector offers, however, cluster around Basic being 35–50% of CTC and HRA being 40–50% of Basic, which is why this calculator uses those as adjustable defaults rather than fixed numbers.
The new regime (the default since FY 2023–24) offers lower slab rates and a bigger standard deduction, but drops HRA exemption, Section 80C, and Section 80D benefits entirely. The old regime keeps those exemptions but taxes you at higher slab rates. Figures here use the slabs applicable for FY 2026–27 (AY 2027–28). Which one saves you more tax depends entirely on how much you actually claim under 80C, 80D, and HRA — toggle between the two above to compare your own numbers.
A ₹12,00,000 CTC with the default 40% Basic / 50% HRA structure, under the new regime:
Basic ≈ ₹4,80,000 • Employer PF + gratuity ≈ ₹80,700 (reduces gross salary) • Taxable income after standard deduction falls under the ₹12L rebate threshold, so income tax is ≈ ₹0. Monthly in-hand comes to roughly ₹88,000–89,000, depending on your exact PF and professional tax.
Enter your CTC and adjust the Basic and HRA percentages if you know your actual offer letter figures. Switch to the old regime if you plan to claim 80C, 80D, or HRA exemption, and fill in your rent and investments to see the comparison.
Because CTC includes amounts you never receive monthly — your employer's PF contribution and gratuity provisioning stay with the company (gratuity only pays out after 5 years of service, if at all) — on top of your own PF contribution, professional tax, and income tax being deducted from what's left.
If your HRA exemption plus 80C and 80D claims are large relative to your income, the old regime can work out cheaper despite higher slab rates. If you don't have significant deductions to claim, the new regime's lower rates usually win. Compare both using the toggle above with your real numbers.
Not necessarily — this is a working estimate based on common CTC structuring. Your employer's exact Basic/HRA split, whether PF is capped at the statutory wage ceiling, other allowances like LTA or meal cards, and your state's exact professional tax slab can all shift the real number. Use your payslip or offer letter for the precise figures.
