₹12 LPA In-Hand Salary in FY 2026-27: A Line-by-Line Breakdown
A ₹12 lakh offer works out to roughly ₹91,900 a month in hand under the new tax regime — with zero income tax. Here's where the other ₹8,000 goes, and what 6 to 25 LPA look like.
By BizToolsIndia Editorial Team · Published · 4 min read
Key takeaways
- ₹12 LPA ≈ ₹91,876 a month in hand with a typical structure (40% basic, PF on the ₹25,000 ceiling, gratuity in CTC).
- Income tax is nil: taxable salary of ₹10.66 lakh is under the ₹12 lakh rebate limit after the ₹75,000 standard deduction.
- The gap from ₹1,00,000 is employer PF, gratuity, your own PF and professional tax.
- PF on full basic instead of the ceiling lowers monthly in-hand to about ₹88,276 but raises savings.
The short answer
CTC ÷ 12 is ₹1,00,000, but that is the cost to your employer, not your salary. With a common structure — basic at 40% of CTC, PF on the ₹25,000 wage ceiling, gratuity included in CTC and ₹200 a month professional tax — a ₹12 lakh CTC gives about ₹91,876 a month in hand under the new tax regime for FY 2026-27.
Line-by-line breakdown
| Item | Annual | Monthly |
|---|---|---|
| CTC | ₹12,00,000 | ₹1,00,000 |
| − Employer PF (12% of ₹25,000) | ₹36,000 | ₹3,000 |
| − Gratuity provision (4.81% of basic) | ₹23,088 | ₹1,924 |
| = Gross salary | ₹11,40,912 | ₹95,076 |
| − Your PF (12% of ₹25,000) | ₹36,000 | ₹3,000 |
| − Professional tax | ₹2,400 | ₹200 |
| − Income tax | ₹0 | ₹0 |
| = In-hand salary | ₹11,02,512 | ₹91,876 |
Employer PF and gratuity are part of your CTC but never reach your bank account each month: PF goes to your EPF account and gratuity is paid only when you leave after becoming eligible. Your own PF and professional tax are then deducted from gross salary.
Why there's no income tax
Under the new regime, salaried people get a ₹75,000 standard deduction. Taxable income here is ₹11,40,912 − ₹75,000 = ₹10,65,912. The slab tax on that is fully offset by the rebate available when taxable income is up to ₹12 lakh, so tax is nil. Once taxable income crosses ₹12 lakh, tax starts — with marginal relief so that tax never exceeds the income above ₹12 lakh.
Note
How PF choices change in-hand pay
| PF calculated on | Monthly in-hand | Into EPF + EPS each month |
|---|---|---|
| ₹25,000 ceiling (from 17 Sep 2026) | ₹91,876 | ₹6,000 |
| ₹15,000 ceiling (before 17 Sep 2026) | ₹94,276 | ₹3,600 |
| Full basic (₹40,000) | ₹88,276 | ₹9,600 |
Lower in-hand isn't necessarily worse: the difference goes into your provident fund. Read what the ₹25,000 PF ceiling changes for the full picture.
Does the basic percentage matter?
Less than you might expect at this salary level. Once basic crosses ₹25,000 a month, PF on the ceiling is fixed at ₹3,000, so only the gratuity provision changes with basic:
| Basic as % of CTC | Monthly basic | Gratuity in CTC (year) | Monthly in-hand |
|---|---|---|---|
| 30% | ₹30,000 | ₹17,316 | ₹92,357 |
| 40% | ₹40,000 | ₹23,088 | ₹91,876 |
| 50% | ₹50,000 | ₹28,860 | ₹91,395 |
A higher basic lowers in-hand by a few hundred rupees but increases the gratuity you build up. If your employer puts PF on full basic, the difference is much larger, because every extra rupee of basic then carries 24% in PF. Under the labour codes' 50% wage rule, very low basic structures are also becoming less common.
What about variable pay?
If ₹1.2 lakh of the ₹12 lakh CTC is a performance bonus, your fixed pay shrinks. Monthly in-hand drops to about ₹81,876, and the bonus arrives only if and when it is paid, usually once a year. Tax is still nil in this example because total taxable income stays under ₹12 lakh. Always ask how much of an offer is guaranteed.
In-hand salary from 6 to 25 LPA
| CTC | Gross / month | Income tax / year | In-hand / month |
|---|---|---|---|
| ₹6 LPA | ₹46,638 | ₹0 | ₹44,038 |
| ₹8 LPA | ₹62,384 | ₹0 | ₹59,184 |
| ₹10 LPA | ₹78,730 | ₹0 | ₹75,530 |
| ₹12 LPA | ₹95,076 | ₹0 | ₹91,876 |
| ₹15 LPA | ₹1,19,595 | ₹87,382 | ₹1,09,113 |
| ₹20 LPA | ₹1,60,460 | ₹1,76,908 | ₹1,42,518 |
| ₹25 LPA | ₹2,01,325 | ₹2,96,634 | ₹1,73,406 |
Your figure will differ if your basic is a different share of CTC, if your CTC includes variable pay (paid only when earned), or if your employer deducts insurance or meal-card amounts. Enter your own structure in the CTC to In-Hand Salary Calculator.
Checklist before you accept an offer
- Ask for the full salary breakup, not just CTC.
- Check how much of CTC is variable and how it is paid.
- Confirm whether PF is on the ceiling or on full basic.
- Check whether gratuity and insurance premiums are inside CTC.
- Compare offers on monthly in-hand and on long-term savings, not headline CTC. The Salary Hike Calculator helps compare raises.
Frequently asked questions
What is the in-hand salary for 12 LPA?
About ₹91,900 a month with 40% basic, PF on the ₹25,000 ceiling, gratuity in CTC and ₹200 professional tax, under the new regime for FY 2026-27.
Is ₹12 lakh salary tax-free in the new regime?
Salary income is effectively tax-free if taxable income after the ₹75,000 standard deduction is up to ₹12 lakh, because of the rebate. A ₹12 lakh CTC usually leaves taxable income well below that.
Why is my in-hand lower than this estimate?
Common reasons are variable pay included in CTC, a higher basic percentage (more PF), insurance premiums, or TDS your employer calculates on other declared income.