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Decode your salary offer. Calculate your monthly take-home salary from your annual Cost to Company (CTC) package.
Variable pay is excluded from monthly in-hand calculation.
Employee & Employer share
Fixed ₹200/month
Companies often include Gratuity and Insurance in CTC. These are not part of your monthly gross salary and are deducted before reaching your "In-Hand" amount.
CTC is the total amount an employer spends on an employee in a year. It includes your salary, employer's contribution to EPF, Gratuity, Insurance, and any other benefits.
Gross Salary is the amount calculated after deducting employer's contributions (like EPF and Gratuity) from the CTC. This is the amount before your own taxes and deductions.
This is the final amount that gets credited to your bank account every month. It is calculated by deducting Income Tax (TDS), Employee EPF contribution, and Professional Tax from your Gross Salary.
CTC includes many 'hidden' costs like employer's EPF contribution, gratuity provision, and insurance. Additionally, your own EPF contribution and Income Tax are deducted from your gross salary before it reaches your bank.
No. Gratuity is a statutory benefit paid only after 5 years of continuous service. However, companies include the 'provision' for it in your CTC to show the total cost they incur.
The New Tax Regime is generally better for those who don't have many investments (like LIC, PPF, Home Loan). The Old Regime is better if you have significant deductions under Section 80C, 80D, etc.
There is no fixed rule, but most Indian companies set Basic Salary at 40% to 50% of the total CTC or Fixed Salary component.