Find out your actual earnings with our Net Salary Calculator. This Salary Calculator helps you estimate your take-home pay after deductions. Try it now!

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Salary: The amount an employer pays to an employee on a regular basis. The contract of employment will detail the salary and other forms of benefit.

What is a Salary Calculator?

A salary calculator is an easy-to-use application that helps individuals calculate their take-home annual and monthly salaries, including total deductions for both periods. To get the exact value, employees need to fill out their Cost to Company (CTC), along with CTC-based bonus(if any), monthly PGT, and deductions (both employee and employer) for PF, rent, etc., that they might have.

What are the Components of the Salary Structure?

• CTC (Cost to Company): The CTC will be calculated as 40% to 50% of the Basic Salary. That percentage constitutes the one-third portion of the Total Cost to Company (CTC) Headline.
• House Rent Allowance (HRA): It is the allowance that an employer provides to their employees to compensate for living in rented accommodation. It is partly/ fully exempt under Section 10 (13A) of the Income Tax Act, 1961. It means that if a Ph.D. fresher cannot accommodate himself in the rented house, the whole of the house will be liable to tax.
• Leave Travel Allowance (LTA): Some companies also provide a Leave Travel Allowance (LTA) to help employees with their travel expenses. Employees must submit proof of travel to claim this allowance.
• Professional Tax: State Governments impose a tax on Employment. Professional Tax: Rs 2500, which is the maximum that can be charged under a financial year.
• Special Allowance: According to the pay structure, some employees may also receive a fully taxable special allowance as part of their salary.
• Bonus: A bonus is a performance-based incentive that The Employer may reward employees.
• Employee EPF Deposit: The Employee Provident Fund (EPF) is 12% of the basic salary paid by both the employer and the employee every month under this scheme. The amount contributed by an employee under Section 80C of the tax code is deductible.

How Do Salary Calculators Work?

To get your take-home salary, you have to provide CTC, bonus PF, professional tax, and all other deductions. See example

Your Cost to the Company (CTC) is Rs 5 lakh. Your company offers an incentive pay of Rs 50,000 gross per year, so your gross salary will be a total of Rs 5,00,000Rs 50k [bonus is deducted from CTC (Remember)].

Gross Salary = Rs 5,00,000 Rs 50,000 = Rs 4,50,000

Home Professional Tax (Deduction of Rs 2,400/annum) The first deduction one needs to make when calculating gross salary is professional tax at Rs 2,400 p.a. Next is the employee provident fund (EPF) deduction, which requires the use of the EPF deduction. EPF contribution (12% of Rs 15,000) per month, i.e., Rs 1,800 per month and Rs 21,600 annually.

Take our example, where both the employee and employer contribute Rs. 21,600 per annum to the EPF. It is important to note that 8.33% of the employer’s contribution is allocated to the employee pension scheme. Additionally, we will implement a fixed annual deduction of Rs 2000 for certain employee insurance.

Total Deductions = Professional tax + EPF (Employee Contribution) + EPF (Employer Contribution) + Employee Insurance

Total Deductions = Rs 2,400 + Rs 21,600 + Rs 21,600 + Rs 2,000 = Rs 47,600.

Take Home Salary = Gross Pay Total Deductions

Take Home Salary = Rs 4,50,000 Rs 47,600 = Rs 4,02,400

Benefits of Salary Calculator in India

• Quick Results

MySipcalculators salary calculator within hands calculates take-home salary within a few seconds

• Identifies Changes

The calculator provides users with an understanding of how the salary structure changes when a bonus or penalty is added or removed from an employee.

• Clear Bifurcation

Gross Salary Calculator: The gross salary calculator aims to break down the various components of an employee’s salary clearly and concisely. It then bifurcates and outlines the exact amounts and deductions.

• Availing an Estimation

Mysipcalculators CTC calculator estimates and clarifies monthly and yearly deductions in EPF, Employer Employee Contribution.