1. What is Net Salary?

Net salary, also known as take-home salary, is the amount an employee receives 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 following formula:

Where:

• Gross Salary — Total salary before any deductions
• Income Tax — Tax deducted based on income tax slabs
• PF — Employee's contribution to Provident Fund (typically 12% of basic salary)
• Professional Tax — State-specific tax deducted by employer

3. Importance of Net Salary Calculation

Details: Understanding net salary helps employees budget effectively, negotiate better salaries, and plan their finances. It's the actual amount that will be credited to your bank account each pay period.

4. Using the Calculator

Tips: Enter your annual gross salary and all applicable deductions. The calculator will compute your annual net salary. For monthly net salary, divide the result by 12.

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 after all deductions.

Q2: How is income tax calculated in India?
A: Income tax is calculated based on your income slab under the old or new tax regime as per your choice.

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 basic salary.

Q4: What is professional tax?
A: Professional tax is a state-level tax deducted by employers, with maximum annual limit of ₹2,500 (varies by state).

Q5: Are there other deductions not included here?
A: Yes, other deductions may include ESIC, meal coupons, insurance premiums, etc., depending on your employment terms.