💼 Salary 🇮🇳 FY 2025-26 Last tested2026-07-01
CTC → in-hand salary.
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Quick answer
A ₹12 lakh CTC (40% basic, new regime) is about ₹90,200/month in hand — after employer + employee EPF (₹57,600 each) and professional tax, with zero income tax thanks to the Section 87A rebate up to ₹12L taxable income.
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FY 2025-26Salary → Take-Home (India)
₹
₹12.00 L / year
%
Basic = ₹4.80 L (most companies use 40–50%)
₹
EPF + ELSS + PPF + LIC etc., capped ₹1.5L
₹
HRA exemption, 80D, home-loan interest, NPS…
₹
Monthly Take-Home
₹90,200
in-hand each month · ₹10.82 L/year
Best Regime
new
saves ₹1.05 L/yr vs old
Where your CTC goes (annual)
Annual CTC
₹12,00,000− Employer EPF (inside CTC)
₹57,600= Gross salary
₹11,42,400− Employee EPF (12% of basic)
₹57,600− Professional tax
₹2,400− Income tax (new regime)
₹0= Annual take-home
₹10,82,400✨ Live · Estimates for salaried employees; gratuity, variable pay & flexi components vary by employer.
AR
Reviewed by
CFP® with 12+ years in mortgage & retirement planning.
🧮 The math
How CTC becomes take-home.
- 1. CTC − employer EPF (12% of basic) − gratuity provision = Gross salary
- 2. Gross − standard deduction (₹75K new / ₹50K old) − old-regime deductions = Taxable income
- 3. Taxable → slab tax + 4% cess (87A rebate: zero tax ≤ ₹12L new / ≤ ₹5L old) = Income tax
- 4. Gross − employee EPF − professional tax − income tax = Take-home
FY 2025-26 new-regime slabs: 0% to ₹4L · 5% to ₹8L · 10% to ₹12L · 15% to ₹16L · 20% to ₹20L · 25% to ₹24L · 30% above.
Sources: Income Tax Department of India · EPFO
❓ FAQ
Common questions.
Why is my in-hand salary so much lower than my CTC?
CTC (cost to company) includes things you never see in your bank account: the employer's EPF contribution (12% of basic), gratuity provision, insurance premiums, and sometimes one-time joining bonuses or ESOPs. From the remaining gross salary, your own EPF (another 12% of basic), professional tax, and income tax (TDS) are deducted. A ₹12 lakh CTC typically lands around ₹80,000–85,000/month in hand.
What is a typical CTC structure in India?
A common structure: Basic salary 40–50% of CTC, HRA 40–50% of basic, employer EPF 12% of basic, and the rest as special allowance plus flexi benefits (LTA, meal cards, fuel). Basic matters most — EPF, gratuity, and HRA exemption are all computed from it. A low basic means higher in-hand today but lower retirement savings.
Which regime should I pick — old or new?
For FY 2025-26, the new regime is default and better for most salaried people because of the ₹75,000 standard deduction and zero tax up to ₹12 lakh taxable income (Section 87A rebate). The old regime only wins if your combined deductions (80C ₹1.5L, HRA exemption, home-loan interest up to ₹2L, 80D, NPS) are large — typically above ₹4–4.5 lakh a year. This calculator computes both and picks the cheaper one.
Is EPF deducted from CTC or gross salary?
Both sides. The employer's 12% of basic is part of your CTC (money you never receive as salary), and your own 12% of basic is deducted from gross pay. Both go to your EPF account, so it is forced savings rather than a loss — but it does reduce the monthly credit to your bank.
What is professional tax and why does it differ by state?
Professional tax is a state-level tax on employment, capped at ₹2,500 per year by the Constitution. Karnataka and Maharashtra charge ₹200/month, West Bengal ₹208 in some slabs, while Delhi, UP, and Haryana charge none. Your employer deducts it and it is fully deductible from taxable income in the old regime.