CTC vs gross salary vs in hand salary: the difference
CTC is what the company spends, gross is CTC minus the employer's PF and gratuity contributions, and in hand is gross minus income tax, your own EPF and professional tax. For a 12 LPA CTC in FY 2026-27 that is ₹12,00,000 of CTC, ₹11,42,400 gross and ₹10,82,400 in hand for the year, or ₹90,200 a month.
FY 2026-27 figures, rules verified 3 Sep 2026. Numbers assume basic at 40% of CTC, employer PF inside CTC and ₹2,400 professional tax unless stated.
Gross salary is the figure on the top line of your payslip: basic, HRA, special allowance and every other allowance added together. It excludes the employer contributions that sit inside CTC.
Net or in hand salary is gross minus the three statutory deductions: TDS on income tax, employee EPF at 12% of basic and professional tax where the state levies it. Any company deductions such as meal cards or insurance premiums come out after that.
The gap widens with income because tax rises faster than salary. At 20 LPA the gross is ₹19,04,000 and the in hand is ₹1,36,097 a month, an effective income tax rate of 9.4% on gross.
See the figure for your own salary on the in hand calculator.
Questions
Related terms
- CTC — CTC stands for cost to company: the total amount an employer spends on you in a year, including your gross salary, the employer share of provident fund, any gratuity provision, insurance premiums and sometimes the value of perks.
- In hand salary — In hand salary, also called take home or net salary, is the amount credited to your bank account each month after income tax, employee provident fund and professional tax are deducted from gross salary.
- TDS on salary — TDS on salary is the income tax your employer deducts under section 192 each month, computed by estimating your tax for the whole year and spreading it across the remaining months.