AKG Money

CTC to in-hand, old vs new regime

Your offer letter says CTC. Your bank account says something else. See where the difference goes (PF, gratuity, tax) and which tax regime leaves you more each month.

These are example numbers. Change any of them to see your own answer.

Your offer

Cost to company, from your offer letter.

₹

= ₹18 L

Share of CTC paid as a yearly bonus, if any.

%
Your rent

Only counts in the old regime, through HRA.

₹
Do you live in Delhi, Mumbai, Kolkata or Chennai?

HRA exemption is up to 50% of basic in these cities, 40% elsewhere.

Old-regime deductions

ELSS, PPF, life insurance, children's tuition, home-loan principal. 80C is capped at ₹1.5 L including your PF.

₹

Up to ₹25,000 for your family, plus up to ₹50,000 for senior-citizen parents.

₹

For a home you live in; up to ₹2 L counts.

₹

Up to ₹50,000 extra.

₹
New regime

You'll get about ₹1,08,953 a month in hand, plus about ₹1,57,001 of bonus after tax. The new regime saves ₹65,340 of tax a year (₹5,445 a month).

Income tax for the year
₹1,25,625
7.5% of your salary
Saved into PF every month
₹14,400
Your 12% plus your employer's. Still yours, just not in hand.

From ₹18 L CTC to your bank account

CTC18,00,000

Less: employer's PF−86,400

goes to your PF account

Less: gratuity−34,632

paid when you leave after 5 years

Less: your own PF−86,400

Less: professional tax−2,500

Less: income tax (new regime)−1,25,625

In hand over the year₹14,64,443

Each month₹1,08,953

Bonus, after tax₹1,57,001

The two regimes, tax year 2026-27
ItemNew regimeLess taxOld regime
Salary₹16,78,968₹16,78,968
Deductions₹75,000₹4,41,900
Taxable income₹16,03,968₹12,37,068
Income tax with cess₹1,25,625₹1,90,965
In hand each month₹1,08,953₹1,04,092

Deductions in the old regime

  • Standard deduction₹50,000
  • HRA exemption₹2,28,000
  • Professional tax₹2,500
  • 80C: your PF and investments₹1,36,400
  • 80D: health insurance₹25,000

The old regime would need about ₹2,09,423 more in deductions to catch up.

Use your take-home pay in

In hand, new regime₹1,08,953/mo

How this is worked out

  1. CTC is split into basic, HRA, variable pay, employer's PF (12% of basic), gratuity (4.81% of basic) and any employer NPS; the rest is special allowance. Change the split to match your salary slip.
  2. Salary that's taxed is everything paid out to you: basic, HRA, special allowance, variable pay and employer NPS. Employer PF and gratuity aren't paid to you now.
  3. New regime: ₹75,000 standard deduction and employer NPS (up to 14% of basic), then the new slabs. Income up to ₹12 lakh after deductions is tax-free, with marginal relief just above.
  4. Old regime: ₹50,000 standard deduction, HRA exemption (the least of HRA received, rent minus 10% of basic, and 50% or 40% of basic), professional tax, 80C up to ₹1.5 lakh including your PF, 80D, home-loan interest up to ₹2 lakh, and NPS.
  5. In hand = salary paid out − your PF − professional tax − income tax. Tax is assumed spread evenly over the year; your employer's TDS may differ month to month.

Questions people ask

Which regime should I choose?

Whichever leaves less tax for your numbers. The new regime usually wins unless you have large deductions: high rent with HRA, a home loan, and full 80C and 80D. HRA exemption is tied to your basic pay, so a low basic shrinks it. Salaried people can choose each year when filing.

Why is my in-hand so much lower than CTC ÷ 12?

Because CTC includes money you don't receive monthly: your employer's PF, gratuity, any NPS, and variable pay paid once a year, plus your own PF and tax come out of your salary.

Is PF a loss?

No. Both your PF and your employer's go into your EPF account, earning interest (8.25% for 2024-25). It's forced long-term saving you can withdraw under the rules.

Are these the latest tax rates?

They're the rates for tax year 2026-27 for resident individuals under 60, last checked on 24 October 2026. Budget 2026 kept the new-regime slabs, standard deduction and rebate unchanged. Senior citizens have different old-regime limits.

Is my data saved anywhere?

No. Everything is worked out in your browser. Your numbers stay on your own device, and the page link holds them if you choose to share.