Salary Calculator

The INDmoney in-hand salary calculator helps estimate your monthly net salary after deductions, providing a clear view of your take-home pay for better financial planning.
Select tax regime

Old Tax Regime

New Tax Regime (FY 2023-24)

A salary serves as a testament to your hard work and dedication, representing the compensation you receive for the services you provide as an employee. In India, salaries are typically paid on a monthly basis, and they encompass various components that determine your take-home pay. Delve into the intricacies of these components and unravel the mystery of salary calculations with INDmoney's insightful guide.

What is a Salary Calculator?

A Salary Calculator is a powerful tool designed to help you estimate your take-home pay after deductions. It considers various components like Basic Salary, HRA, and more, while factoring in deductions like Provident Fund (PF), Professional Tax, Income Tax, Gratuity, and Home Loan Interest. With this tool, you can get a clear picture of your actual earnings.

How to Use INDmoney’s In-Hand Salary Calculator

Navigating your way through INDmoney's In-Hand Salary Calculator is a breeze, allowing you to swiftly estimate your take-home pay with precision. Follow these simple steps to make the most of this user-friendly tool:

Step 1: Enter Your Details
Begin by entering your essential information:

- Yearly CTC: Enter your annual Cost to Company (CTC), the sum of all your components.

- Basic Salary: A part of the CTC which is completely taxable.

- Select Tax Regime: Choose your In-Hand Salary Calculation according to the tax regime you prefer (New vs. Old).

Step 2: Submit Your Details

After entering the necessary information, click on the 'Calculate' button.

Step 3: Instant Calculation

Watch as the magic happens! INDmoney's calculator will process your details and instantly present you with a comprehensive salary breakdown:

- Take-Home Salary: Your net earnings after all deductions and taxes.

- HRA: Housing-related allowance, if applicable.

- Professional Tax: State government-imposed tax on earnings.

- EPF: Employee Provident Fund contributions, typically Rs 1800/month by default.

- Income Tax: Amount deducted as per the chosen tax regime.

- Medical Insurance: Provided by the company as a part of CTC for employee health benefits.

Step 4: Edit and Update

Want to know your exact in-hand salary? No problem! Feel free to update the given components, and the changes will reflect in the amount accordingly. As you make changes, the calculator works its magic once again, instantly updating your take-home salary and component details.

Gross Pay and Take Home Salary

- Gross Pay: Calculated by subtracting EPF and Gratuity amounts from the Cost-to-Company (CTC).

- Take Home Salary: Calculated by eliminating Income Tax from the Gross Pay.

Components of Salary

Your salary is more than just a number—it's a sum of various components that make up your compensation package. Understanding these components is essential for evaluating your earnings and planning your financial future. Here's a breakdown of the most common salary components:

1. Basic Salary

   - Definition: The fixed foundational portion of your earnings.

   - Tax Implication: Fully taxable; typically constitutes 35-50% of your total gross salary.

   - Determining Factors: Employee's designation, industry, and experience.

2. House Rent Allowance (HRA)

   - Definition: Monetary allowance to cover rented accommodation expenses.

   - Tax Implication: Fully taxable if not utilized for rent.

   - Benefit: Eligible for tax exemption if staying in a rented property.

3. Leave Travel Allowance (LTA)
  - Definition: Allowance for travel expenses during approved leave.

   - Tax Implication: Eligible for income tax exemption under the Income Tax Act, 1961.

4. Special Allowance

   - Definition: Additional fixed amount for specific needs.

   - Tax Implication: Fully taxable component.

5. Bonus

   - Definition: Performance-based incentive granted by employers.

   - Tax Implication: Entire bonus amount is fully taxable.

6. Employee Provident Fund (EPF)

   - Definition: Investment by both employer and employee for retirement benefits.

   - Tax Implication: Contribution available for deduction under Section 80C of the Income Tax Act, 1961.

7. Professional Tax

   - Definition: State government-imposed direct tax on earnings.

   - Maximum Amount: INR 2,500 per year.

Taxable Income

The portion of your earnings that is subject to income tax. Tax-saving instruments can be deducted from the CTC to calculate the total taxable salary. The tax slabs are also determined based on which slab your taxable income falls into.

Tax Exemptions in New Tax Regime

Only EPF and Gratuity are exempted from tax in the New Tax Regime. Taxpayers choosing the New Tax Regime won’t get tax benefits on certain components as they did in the Old Tax Regime, such as:

- House Rent Allowance (HRA)

- Leave Travel Allowance

- Conveyance

- Relocation allowance

- Children education allowance

- Standard deduction

- Interest on housing loan (Section 24)

- Daily expenses in the course of employment

- Helper allowance

- Other special allowances (Section 10(14))

- Professional tax

- Chapter VI-A deductions (80C, 80D, 80E, etc., except Section 80CCD(2) and 80JJA)

Types of Salary Calculators Available

In India, several types of take home salary calculators cater to different financial needs and planning scenarios. Here’s a breakdown of the main types:

1. Basic Take-Home Pay Calculator

   - Purpose: Determines your net salary after accounting for deductions such as Income Tax, Provident Fund (PF), and Professional Tax.

   - Benefit: Provides a clear view of your actual monthly take-home pay.

2. Income Tax Calculator

   - Purpose: Estimates your annual tax liability based on your salary, various deductions, and exemptions allowed under the Income Tax Act.

   - Benefit: Helps in planning for tax savings and filing returns.

3. NPS Calculator

   - Purpose: Designed for subscribers of the National Pension System to estimate the future pension and lump sum you might receive from your NPS account.

   - Benefit: Factors in contributions, expected returns, and annuity choices.

4. Gratuity Calculator

   - Purpose: Calculates the gratuity amount you are eligible to receive after ending employment, based on your tenure and the last drawn salary.

   - Benefit: Useful for understanding end-of-service benefits.

Frequently Asked Questions

  • What if my company provides additional benefits like stock options or allowances not listed in the calculator?

  • How can I use the calculator to optimize my tax savings?

  • Does CTC include PF?

  • Should I opt for New Tax Regime or stick to the Old?

  • Can I file my income tax return without Form 16?

  • What is Section 80C deduction?

  • What information do I need to use a salary calculator?

  • Can a salary calculator help me with tax planning?

  • Is the use of a salary calculator secure?

  • Can a salary calculator help me with tax planning?

  • What information do I need to use a salary calculator?

  • How do I use a salary calculator?