Salary Calculator
CTC to take-home pay, with new vs old regime tax for Tax Year 2026-27.
Tax Year 2026-27 (FY 2026-27), Income-tax Act 2025 · Official sources
New vs old regime
Where your CTC goes
- Take-home —
- Income & professional tax —
- PF (yours + employer’s in CTC) —
- Gratuity —
What makes up your CTC
| Component | Monthly | Yearly |
|---|
From gross pay to take-home
| Item | Monthly | Yearly |
|---|
Your income tax for Tax Year 2026-27
| Yearly | New regime | Old regime |
|---|
Slab-by-slab calculation (new regime)
| Slab | Rate | Income in slab | Tax |
|---|
Rules used and official sources
Tax Year 2026-27 (FY 2026-27) under the Income-tax Act, 2025, with Finance Act, 2026 rates; EPF wage ceiling ₹25,000 a month. The calculator follows these texts:
- Income-tax Act, 2025 (No. 30 of 2025) — sections 19, 123, 156, 202 and 516
- Finance Act, 2026 (No. 4 of 2026) — surcharge and old-regime rates
- Memorandum to the Finance Bill, 2026 — no rate changes, 4% cess
- S.O. 5109(E) — EPF wage ceiling of ₹25,000 a month
- EPFO FAQs on the new wage ceiling
- Constitution of India, Article 276(2) — professional tax limit of ₹2,500 a year
Tax rules and rates change. This calculator follows the rules described on this page and may not cover every situation. Check the official source or a qualified tax professional before filing or invoicing.
About the Salary Calculator
Your CTC (cost to company) is not what reaches your bank account. This calculator splits a CTC into basic pay, HRA and special allowance, takes out the employer’s PF and gratuity if they are counted in the CTC, then deducts your own PF, professional tax and income tax to show your monthly and yearly take-home pay.
Income tax is worked out for Tax Year 2026-27 (1 April 2026 to 31 March 2027) under the Income-tax Act, 2025 — for the new regime (the default) and the old regime side by side, so you can see which leaves you with more. The rates were checked against the official gazette texts.
How to use it
- Enter your annual CTC from the offer letter, and any variable pay or bonus that is included in it.
- Set basic pay (% of CTC) and HRA (% of basic) to match your payslip, and choose how your employer calculates PF.
- Tick whether employer PF and gratuity are counted inside your CTC, and enter your State’s professional tax (₹0 if there is none).
- For the old regime, optionally add your age group, the rent you pay and other deductions you can claim.
- Compare the take-home pay and tax under both regimes, then check the salary and tax breakdown tables.
Examples
Basic 50% · HRA 40% of basic · PF capped at ₹25,000 · employer PF and gratuity in CTC · professional tax ₹200 a month
In-hand ₹91,395 a month · New regime tax ₹0 · Old regime tax ₹1,42,810
In-hand ₹1,29,000 a month + ₹1,58,400 variable pay after tax · New regime tax ₹1,75,910 a year
How CTC becomes in-hand pay
- Basic pay is a percentage of CTC set by your employer — check your offer letter or payslip. PF and gratuity are calculated on it.
- HRA is a percentage of basic pay. It matters for the old-regime HRA exemption.
- Employer PF (12% of PF wages) and gratuity (4.81% of basic) are often counted inside the CTC, but they are not paid to you each month: PF goes to your PF account, and gratuity is paid when you leave after the qualifying service.
- Special allowance is the balancing figure that makes the structure add up to the CTC.
- From your gross pay, your PF (12% of PF wages), professional tax and income tax (TDS) are deducted. What is left is your take-home pay.
PF and the ₹25,000 wage ceiling
You and your employer each contribute 12% of your PF wages; this calculator uses your basic pay as PF wages. Of the employer’s 12%, an amount equal to 8.33% of wages — counting wages only up to the ceiling — goes to the pension scheme (EPS), and the rest to your PF account. The statutory wage ceiling was raised from ₹15,000 to ₹25,000 a month by notification S.O. 5109(E) (gazette, EPFO FAQs) — at that ceiling, each side pays ₹3,000 a month, and the employer’s share splits into ₹2,083 EPS and ₹917 EPF.
Some employers limit PF to the ceiling; others contribute on the full basic pay. Pick the option that matches your payslip.
Income tax for Tax Year 2026-27
New regime (the default, section 202 of the Income-tax Act, 2025): up to ₹4 lakh nil; ₹4–8 lakh 5%; ₹8–12 lakh 10%; ₹12–16 lakh 15%; ₹16–20 lakh 20%; ₹20–24 lakh 25%; above ₹24 lakh 30%. The standard deduction for salary is ₹75,000. The section 156 rebate makes the tax nil when taxable income is ₹12 lakh or less, with marginal relief just above it — so a salary of up to ₹12.75 lakh (₹12 lakh plus the standard deduction) pays no income tax.
Old regime (you can opt for it instead; if you have no business income you choose when you file each year’s return): nil up to ₹2.5 lakh (₹3 lakh at 60–79, ₹5 lakh at 80 or older); 5% up to ₹5 lakh; 20% up to ₹10 lakh; 30% above. The standard deduction is ₹50,000, and professional tax, the HRA exemption and deductions for investments and insurance are allowed — your PF, PPF, life insurance, ELSS and similar together up to ₹1,50,000 (section 123), plus separate limits for health insurance (section 126) and an extra ₹50,000 for your own NPS contributions (section 124(3)). A rebate of up to ₹12,500 applies when taxable income is ₹5 lakh or less.
Both regimes: a surcharge of 10% above ₹50 lakh, 15% above ₹1 crore and 25% above ₹2 crore (old regime: 37% above ₹5 crore), with marginal relief at each threshold, then 4% Health and Education Cess on tax plus surcharge. Taxable income and tax are rounded to the nearest ₹10 (section 516). Sources: Income-tax Act, 2025, Finance Act, 2026, Budget 2026 memorandum.
Old-regime HRA exemption
If you pay rent and your salary includes HRA, the old regime exempts part of it. This calculator uses the long-standing method: the least of (1) the HRA you receive, (2) rent paid minus 10% of salary (basic pay), and (3) 50% or 40% of salary depending on the city. The Income-tax Act, 2025 leaves these limits to the Income-tax Rules (Schedule III, item 11), so check the current rules for your city before relying on the figure. The HRA exemption is not available in the new regime.
Limitations
- Assumes a resident individual whose only income is this salary. Other income, capital gains, perquisites and arrears are not included.
- Employer NPS contributions, voluntary PF, meal cards, LTA and other components are not modelled.
- Uses the ₹25,000 PF wage ceiling for the whole year, although it took effect on 17 September 2026; before that the ceiling was ₹15,000.
- Professional tax differs by State; enter the amount on your payslip. The Constitution caps it at ₹2,500 a year.
- Old-regime deductions are used as you enter them; limits such as ₹1,50,000 for section 123 investments are not checked for you.
- Employers may spread TDS differently through the year, so a particular month’s salary can differ from the average shown.
Privacy
Everything happens in your browser. What you enter or open here is not uploaded or stored by MySmartCoPilot.
Frequently asked questions
Which tax regime is better for me?
It depends on your deductions. The new regime has lower rates and no tax up to ₹12 lakh of taxable income, but it does not allow the HRA exemption, professional tax or most investment deductions. If your old-regime deductions are large, the old regime can still cost less — enter them and compare.
Is a ₹12 lakh salary tax-free in 2026-27?
Under the new regime, salary is tax-free when the taxable amount after the ₹75,000 standard deduction is ₹12 lakh or less, thanks to the section 156 rebate. Just above ₹12 lakh, marginal relief means the tax is never more than the income above ₹12 lakh.
Why is my in-hand salary lower than CTC ÷ 12?
The CTC includes amounts you do not receive monthly — employer PF and gratuity — and your own PF, professional tax and income tax are deducted from your gross pay. Variable pay is also paid separately, usually once a year.
How is gratuity worked out in a CTC?
Gratuity is 15 days’ wages for each completed year of service, where a day’s wage is the monthly basic ÷ 26. Spread over 12 months that is 15 ÷ 26 ÷ 12 ≈ 4.81% of basic, which is why many CTCs include 4.81% of basic as gratuity. It is paid when you leave after the qualifying service, not every month.
Can I still choose the old tax regime?
Yes. The new regime is the default, but section 202(4) of the Income-tax Act, 2025 lets you opt out. If you have no business income, you choose each year when you file your return.
What is professional tax?
A tax on employment charged by some States and deducted by your employer. Rates and slabs differ by State, and Article 276(2) of the Constitution limits it to ₹2,500 a year per person. Enter ₹0 if your State does not levy it.