CTC vs Gross vs In-Hand Salary
Your salary is described in three different numbers, and they are not the same:
| Term | What it means |
|---|---|
| CTC | Total cost to the company, including employer PF, gratuity and benefits |
| Gross Salary | CTC minus employer contributions (employer PF, gratuity) |
| In-Hand / Take-Home | Gross minus your PF, professional tax and income tax |
How In-Hand Salary Is Calculated
- Basic is usually 40–50% of CTC and drives PF and gratuity.
- Employer PF (12% of basic) and gratuity (≈4.81% of basic) are part of CTC but not paid monthly.
- Your PF (12% of basic), professional tax and income tax (TDS) are deducted from gross.
- What remains is your monthly take-home salary.
Frequently Asked Questions
Why is take-home lower than CTC ÷ 12?
Because CTC includes amounts you never receive in cash (employer PF, gratuity) plus deductions like your PF and tax.
Can I increase my take-home?
Take-home depends on your salary structure and tax regime. Choosing the right tax regime and structuring components within your employer's rules can help — use our income tax calculator to compare regimes.