Salary basics
CTC full form and meaning
CTC stands for cost to company: the total your employer spends on you in a year. On a ₹10 lakh CTC, about ₹71,121 a month reaches your bank.
CTC is what you cost your employer, not what you are paid
Indian offer letters quote pay as CTC, usually in lakh per annum (LPA). It adds up the salary paid to you and the money your employer spends on you without paying it as salary, such as its PF contribution and the gratuity it sets aside. That is why your monthly in-hand salary is less than CTC divided by 12.
CTC usually includes these parts
- Basic salary: the fixed core of your pay. Our calculators start it at 50% of CTC and work out PF and gratuity on it; your offer letter gives yours.
- House rent allowance (HRA): a share of basic. Part of it can be tax-free in the old regime if you pay rent.
- Special allowance: what is left of fixed pay after the other parts.
- Variable pay or bonus: paid only if you earn it, often once a year.
- Employer PF: 12% of basic, or of the wage ceiling, paid into your EPF and EPS pension accounts.
- Gratuity: usually shown as 4.81% of basic and paid when you leave after five or more years.
- Employer NPS and benefits: some employers add NPS contributions, insurance premiums or meal cards.
A ₹10 lakh CTC becomes ₹71,121 a month in hand
| A year | A month | |
|---|---|---|
| Basic salary | ₹5,00,000 | ₹41,666.67 |
| House rent allowance | ₹2,50,000 | ₹20,833.33 |
| Special allowance | ₹1,65,950 | ₹13,829.17 |
| Gross salary | ₹9,15,950 | ₹76,329.17 |
| Employer PF | ₹60,000 | ₹5,000.00 |
| Gratuity | ₹24,050 | ₹2,004.17 |
| CTC | ₹10,00,000 | ₹83,333.33 |
| Less your PF | −₹60,000 | −₹5,000.00 |
| Less professional tax | −₹2,500 | −₹208.33 |
| Less income tax | −₹0 | −₹0.00 |
| In-hand salary | ₹8,53,450 | ₹71,120.83 |
From our in-hand calculator: new regime, Maharashtra, basic at 50% of CTC, HRA at 50% of basic, PF at 12% of basic from both sides and gratuity at 4.81% of basic. Taxable income is ₹8,40,950, within the ₹12 lakh rebate limit, so there is no income tax. Rules checked 21 October 2026.
CTC, gross salary and in-hand salary are three different numbers
- CTC is the whole cost to your employer: ₹10,00,000 here.
- Gross salary is CTC less the employer's PF, gratuity and NPS: what is paid to you as salary, ₹9,15,950 here.
- In-hand (net or take-home) salary is gross salary less your PF, professional tax and income tax: ₹8,53,450 here, ₹71,121 a month.
See each part of your own CTC with the salary breakup calculator, or read why in-hand salary is less than CTC.
Two offers with the same CTC can pay different amounts
A higher basic means more PF and gratuity and less cash each month. Variable pay you do not fully receive, benefits counted inside CTC and the state you work in all change what reaches your bank. Ask for the breakup before you compare offers.
CTC, in short
What is the full form of CTC?
CTC stands for cost to company: everything your employer spends on you in a year, including what it pays into PF and sets aside for gratuity.
Is CTC the same as gross salary?
No. Gross salary is the part of CTC paid to you as salary. On a ₹10 lakh CTC with our standard assumptions, gross salary is ₹9,15,950 because employer PF and gratuity sit inside the CTC.
Is CTC the same as in-hand salary?
No. In-hand salary is what reaches your bank after your PF, professional tax and income tax. On a ₹10 lakh CTC it is about ₹71,121 a month under the new regime.
In-hand salary by CTC
- 5 LPA₹35,456 a month
- 6 LPA₹42,589 a month
- 8 LPA₹56,855 a month
- 10 LPA₹71,121 a month
- 12 LPA₹85,387 a month
- 15 LPA₹1,00,300 a month
- 20 LPA₹1,29,330 a month
- 25 LPA₹1,56,125 a month
What LPA means · Every CTC from 3 to 200 LPA
These figures are estimates based on the information you entered and the rules for tax year 2026-27 under the Income-tax Act 2025 as it stands after Budget 2026, EPFO notifications and state professional tax schedules. They are general information, not tax, financial or legal advice. Your actual in-hand salary can differ, for example because of your company's salary structure, variable pay, PF rules, your regime choice, TDS timing or your state. Check your payslip, or ask your payroll team or a chartered accountant, before relying on these figures.