From CTC to in-hand, step by step
- Employer PF (12% of basic) is often counted inside the CTC but goes straight into your PF account.
- Gratuity (about 4.81% of basic) is paid only if you stay five years or more, so it never shows up in monthly pay.
- Your PF is another 12% of basic deducted from salary. It's your savings, not a cost.
- Professional tax is a small state tax, up to ₹2,500 a year, and zero in some states.
- Income tax uses the FY 2026-27 new regime: ₹75,000 standard deduction and no tax up to ₹12 lakh of taxable income, so a fixed salary up to ₹12.75 lakh pays no income tax.
Questions people ask
What basic percentage should I enter?
Check your offer letter. Many companies set basic at 40% to 50% of CTC. A higher basic means more PF and gratuity, and slightly less monthly in-hand.
Why is my PF capped at ₹1,800?
PF is mandatory only on the first ₹15,000 of monthly basic. Some employers contribute only that minimum (12% of ₹15,000 = ₹1,800 a month), which raises your in-hand.