1. What is In-Hand Salary?

In-Hand Salary is the actual amount an employee receives after all deductions like income tax, provident fund, professional tax, etc. It's the net amount credited to your bank account.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• Gross Salary — Total salary before any deductions
• Income Tax — Tax calculated as per new regime tax slabs
• PF — Provident Fund contribution (typically 12% of basic salary)
• Professional Tax — State-specific tax deducted from salary

3. Components of Salary Calculation

New Tax Regime: The calculator uses the new tax regime which generally has lower tax rates but fewer deductions compared to the old regime.

Provident Fund: Typically 12% of basic salary, with equal contributions from employee and employer.

Professional Tax: Varies by state, typically ranges from ₹0 to ₹2,500 per year.

4. Using the Calculator

Tips: Enter all values in INR. For accurate results, use your actual tax and deduction amounts from your payslip.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between gross and in-hand salary?
A: Gross salary is your total earnings before deductions, while in-hand salary is what you actually receive after all deductions.

Q2: Why use new tax regime?
A: The new regime offers lower tax rates but fewer deductions. It may benefit those who don't have many investments or deductions to claim.

Q3: Is PF mandatory?
A: For organizations with 20+ employees, PF is mandatory for employees earning up to ₹15,000 basic salary.

Q4: How is professional tax calculated?
A: It varies by state, typically deducted monthly with an annual maximum (e.g., ₹2,500 in Maharashtra).

Q5: Can I switch between old and new tax regimes?
A: Salaried employees can choose between regimes each financial year, while business/professionals must stick to their chosen regime.