1. What is In-Hand Salary?

In-Hand Salary is the actual amount an employee receives after all deductions like taxes, provident fund, and professional tax have been subtracted from the Cost to Company (CTC).

2. How is In-Hand Salary Calculated?

The calculator uses the following equation:

Where:

• \( CTC \) — Cost to Company (25,000 INR in this case)
• \( Income\ Tax \) — Tax deducted as per income tax slabs
• \( PF \) — Employee's contribution to Provident Fund
• \( Professional\ Tax \) — State-specific professional tax

3. Components of Salary Deduction

Income Tax: Calculated based on government tax slabs and deductions.
Provident Fund (PF): Typically 12% of basic salary, with employee contribution.
Professional Tax: Varies by state, usually between 0-200 INR per month.

4. Using the Calculator

Tips: Enter all deduction amounts in INR. The calculator will subtract these from 25,000 CTC to show your in-hand salary.

5. Frequently Asked Questions (FAQ)

Q1: Is 25,000 CTC good salary?
A: It depends on location and job role. After deductions, in-hand salary would typically be around 20,000-22,000 INR.

Q2: How much PF is deducted from salary?
A: Typically 12% of basic salary, but exact amount depends on company policy.

Q3: Is professional tax same in all states?
A: No, professional tax varies by state in India, with different slabs and maximum amounts.

Q4: Can I reduce my tax liability?
A: Yes, through tax-saving investments under sections like 80C, 80D, HRA exemption, etc.

Q5: Are there other deductions not shown here?
A: Some companies may have additional deductions like insurance premiums, loan recoveries, etc.