💼 Salary & Income 7 min read·Updated 1 July 2026

CTC vs In-hand Salary: Why Your Take-home Is Much Lower

A ₹15 lakh CTC does not mean ₹1.25 lakh in your account every month. Understanding the components helps you negotiate smarter and compare offers honestly.

Typical CTC breakdown

Basic salary (30–50% of CTC) — determines PF, gratuity, HRA.
House Rent Allowance (usually 40–50% of basic).
Special allowance — the flex bucket.
Employer PF — 12% of basic (up to a cap).
Gratuity — 4.81% of basic (paid at exit).
Variable pay/bonus — annual, performance-linked.

What gets deducted from gross

Employee PF (12% of basic).
Professional tax (state-dependent, up to ₹2,500 a year).
TDS (income tax deducted at source).
Any voluntary NPS, insurance, or ESPP contributions.

Rule of thumb

For salaries between ₹10–25 lakh, in-hand is typically 65–75% of CTC in the new regime and 60–70% in the old regime.

Pro tips

Higher basic = higher PF and gratuity but slightly lower take-home. Good for long-term forced savings.
Negotiate the flex bucket, not just the CTC — the flex portion becomes cash faster than gratuity.