Employee Compensation Calculator India โ CTC Breakup & Employer Cost
Calculate the complete CTC breakup, employee in-hand salary, and total employer cost for FY 2025-26. Covers employer PF (12% of basic: 3.67% EPF + 8.33% EPS), EDLI (0.5%), PF admin charges (0.5%), ESI (3.25% employer / 0.75% employee), gratuity provision (4.81%), professional tax by state, and estimated TDS.
How to Use This Calculator
Cost to Company tab
Enter your monthly CTC (as per offer letter) and basic salary as % of CTC (typically 40-50%). The calculator shows the complete CTC breakup: basic, HRA, special allowance, and all employer statutory costs — PF (12% split into EPF 3.67% + EPS 8.33%), EDLI (0.5%), PF admin (0.5%), ESI (3.25% if applicable), gratuity provision (4.81%), and group insurance. Expand "More options" to set HRA % and state for professional tax.
Employee In-Hand tab
Enter the same CTC details and the calculator shows your take-home salary after all deductions: employee PF (12%), professional tax (state-wise), ESI (0.75% if applicable), and estimated TDS based on your chosen tax regime. It also shows how much goes to your PF account each month (employee + employer EPF share).
Hiring 5 Employees tab
Enter CTC per employee and number of employees to see the total monthly and annual cost. The calculator also lists statutory compliance obligations: EPF/ESI registration requirements, challan due dates, Payment of Bonus Act applicability, and gratuity liability — so you know exactly what you're signing up for as an employer.
Share your result
All inputs are encoded in the URL. Click Share to send the exact breakdown to a colleague, HR team, or bookmark for reference.
The Formulas
Employee compensation in India involves multiple statutory components, each governed by different legislation:
CTC = Gross Salary + Employer PF + EDLI + PF Admin + ESI (employer) + Gratuity + Insurance
Gross Salary:
Gross = Basic + HRA + Special Allowance
Employer PF (EPF & MP Act, 1952):
Employer PF = 12% of Basic
• EPF share: 3.67% of Basic → employee's PF account
• EPS share: 8.33% of min(Basic, «15,000) → pension fund
• If Basic > «15,000: full 12% goes to EPF
EDLI (Employees' Deposit Linked Insurance):
EDLI = 0.5% of min(Basic, «15,000)
Provides life cover up to «7 lakh
PF Admin Charges:
Admin = 0.5% of Basic (minimum «75/month)
ESI (ESI Act, 1948):
Applicable if gross wages ≤ «21,000/month
Employer: 3.25% of gross wages
Employee: 0.75% of gross wages
Gratuity (Payment of Gratuity Act, 1972):
Gratuity = (15/26) × Last drawn salary × Years of service
Monthly provision ≈ 4.81% of Basic (15/26/12)
In-Hand Salary:
In-Hand = Gross − Employee PF (12%) − Professional Tax − TDS − ESI (0.75%)
Example
Rahul — software developer in Bangalore, CTC «8,00,000/year
Rahul (26) joins a startup in Bangalore with a CTC of «8,00,000 per year («66,667/month). His basic is 40% of CTC and HRA is 50% of basic. He wants to know his in-hand salary and what his employer actually pays.
Step 1: Salary structure
Step 2: Employer statutory costs (included in CTC)
Step 3: Employee deductions and in-hand
Rahul's CTC of «8 lakh/year translates to approximately «55,677/month in hand. About 7.2% of his CTC goes to employer statutory costs, and 16.5% is deducted from his gross salary as employee PF, PT, and tax.
Understanding the Components
Employer PF: The 12% Split Explained
The employer contributes 12% of basic salary to the PF system, but it's split into two accounts:
- EPF (3.67% of basic) — Goes to the employee's Provident Fund account. This is the employee's money, withdrawable on leaving employment (subject to conditions).
- EPS (8.33% of basic, capped at «15,000 basic) — Goes to the Employees' Pension Scheme. For employees with basic above «15,000/month, EPS contribution is capped at «1,250/month, and the remaining amount goes to EPF instead.
The employee also contributes 12% of basic, which goes entirely to their EPF account. So total EPF accumulation = 12% (employee) + 3.67% (employer EPF) = 15.67% of basic per month.
ESI: When Does It Apply?
ESI (Employee State Insurance) applies only when an employee's gross wages are ≤ «21,000/month («25,000 for PwD). Key points:
- Employer contribution: 3.25% of gross wages
- Employee contribution: 0.75% of gross wages
- Applicable to establishments with 10+ employees (20+ in some states)
- Once wages cross «21,000, both employer and employee ESI contributions stop
- Benefits include medical care, sickness benefit (70% wages), maternity (100% wages for 26 weeks)
For most IT/tech employees with CTC above «3-4 lakh/year, ESI is typically not applicable as gross wages exceed «21,000.
Professional Tax by State
Professional tax is a state-level tax on employment. Key facts:
- Maximum: «2,500/year (constitutional cap under Article 276)
- Maharashtra: «2,500/year for salary > «10,000/month («200/month, «300 in Feb)
- Karnataka: «2,400/year for salary > «15,000/month («200/month)
- No PT: Delhi, Uttar Pradesh, Punjab, Haryana, Uttarakhand, Rajasthan (partially), and several northeastern states
- Deductible from income tax under Section 16(iii)
Gratuity: The 4.81% Hidden Cost
Gratuity is governed by the Payment of Gratuity Act, 1972. It applies to establishments with 10+ employees.
- Formula: (15/26) × Last drawn salary × Years of service
- Monthly provision: Basic × 15/26/12 ≈ 4.81% of basic per month
- Vesting: Payable after 5 years of continuous service
- Cap: Maximum «20 lakh (tax-exempt portion)
- Employer liability: Accrues from day 1, even though payment is due only after 5 years
Many employers include gratuity in CTC as an accrued benefit. It's a real cost to the employer but the employee receives it only on separation after 5 years.