1. What is Net Salary?

Net Salary (In-Hand Salary) is the amount an employee takes home after all deductions like income tax, provident fund (PF), professional tax, etc. have been subtracted from the gross salary.

2. How Does the Calculator Work?

The calculator uses the net salary formula:

Where:

• Gross Salary — Total salary before any deductions
• Income Tax — Tax deducted as per income tax slabs
• PF — Provident Fund contribution (typically 12% of basic salary)
• Professional Tax — State-specific tax (usually up to ₹2,500/year)

Explanation: This formula gives the actual take-home salary after all mandatory deductions.

3. Importance of Net Salary Calculation

Details: Understanding net salary helps in financial planning, loan applications, and assessing actual earnings. It's crucial for comparing job offers and budgeting.

4. Using the Calculator

Tips: Enter all amounts in INR (Indian Rupees). For accurate results, use actual deduction values from your payslip or HR department.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between gross and net salary?
A: Gross salary is your total salary before deductions, while net salary is what you actually receive in your bank account.

Q2: How is income tax calculated?
A: Income tax is calculated based on government-defined slabs. It depends on your income level and tax-saving investments.

Q3: Is PF contribution mandatory?
A: For organizations with 20+ employees, PF contribution (12% of basic salary) is mandatory for employees earning up to ₹15,000/month.

Q4: Does professional tax vary by state?
A: Yes, professional tax rates vary across Indian states, typically ranging from ₹0 to ₹2,500 per year.

Q5: Are there other deductions not included here?
A: Yes, there might be other deductions like ESIC, voluntary PF, loan repayments, etc. that aren't included in this basic calculation.