Understanding CTC Breakup: How Do I Know My Actual Take-Home Salary?

Nowadays, companies are sending CTC breakup first, then the offer. In such cases, I need to be sure about the salary. I mean, which component do I consider in CTC Breakup. Can you please guide me regarding this? Anything you can comment on this, please feel free to write.

In my company, we calculate CTC in the following breakdowns:

CTC Breakdown Example

Consider gross ₹10,000:

- Gross = Basic ₹6,000 + HRA ₹2,000 + CCA ₹1,000 + Conveyance Allowance ₹1,000 = ₹10,000/-
- Deductions = Employee's Contribution to PF ₹720 + Employee's Contribution to ESIC ₹175 + Professional Tax ₹175 = ₹1,070
- Net Pay = Take-home Salary = ₹8,930/- (₹10,000 - ₹1,070 = ₹8,930)

CTC Calculation

CTC = {Other Benefits (Contribution of Employer to PF ₹720 + Contribution of Employer to ESIC ₹475 + Bonus ₹500 + Gratuity ₹250) + Net Pay ₹8,930/-} per month

So, the CTC per year will be ₹11,945/- * 12 = ₹143,340/- per year.

That is really in detail.

Thanks, I have one question. My CTC comprises Medical Allowance and Special Allowance. Does it also come in the take-home pay? Or is there any kind of proof submission needed for the medical allowance on a monthly basis?

Some big companies add medical allowance and special allowance to the monthly gross and provide tax benefits on it after submitting the proof. Some companies do not mention it in the monthly gross.

Thank you!

Great! That means I will get those allowances (Medical, Special) in my monthly salary as it is included in my CTC. However, I have to submit proof for tax benefits. Thanks for the help, Aarti. Have a great day!

I had been in this confusion for years, and then I came across a very good blog post about take-home calculation. All you have to do is download the Excel sheet, enter your offer letter breakup, and get your take-home calculated in minutes. That's it!

You can find the blog post at: http://madbucks.in/2015/10/here-is-how-to-calculate-take-home-from-offer-letter/

I have been using this Excel sheet whenever I change jobs and for salary negotiations.