9 Lakh CTC In hand salary – Zero Tax – New Tax Regime 2024-25

Have you ever wondered how your in hand (take-home) salary is determined when your employer offers a CTC? You might have used online calculators or waited for salary slips to figure it out. What if I told you that by the end of this article, you’ll be able to understand and calculate your in-hand (take-home) salary easily on your own? We have taken an example of 9 lakh (lpa) CTC to calculate In hand salary under New Tax Regime 2024-25.

While you’re aware that tax rates are lower in the New Tax Regime, it’s important to note that tax exemptions and deductions such as House Rent Allowance (HRA), Section 80C deductions, Leave Travel Allowance (LTA), Food Coupons, etc., are not applicable under this regime. In the recent 24-25 Budget, the Finance Minister has enhanced the New Tax Regime by increasing standard tax deductions and improving income slabs. Despite no changes in the Old Tax Regime, it remains advantageous for certain income earners. (Know how to build passive income that lasts long time)

Under the New tax regime, there are only a few exemptions that are relevant to your situation, namely —

• Employer’s contribution to your PF
• Employer’s Contribution to your NPS account
• Conveyance/Travel Allowance, Research Allowance, few others/etc.

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So, without further ado, let’s dive in and calculate the In hand salary from a 9 Lakh (lpa) CTC under the new tax regime for 2024-25

Your CTC consists of the following components —

• Basic Salary
• Exgratia
• HRA
• Employer & Employee Contribution to your EPF
• Conveyance allowance

Calculations of various salary components –

• Basic Salary = 50% * 9 Lac = INR 4.5 Lac [The Basic salary is typically 50% to 55% of your CTC. We are taking 50% for ease of calculation.]
• Employer’s Contribution to PF = 12% of your Basic Salary — 12% * 4.5 Lac = INR54,000/-
• Employee’s Contribution to PF = 12% of your Basic Salary — 12% * 4.5 Lac = INR54,000/-
• House Rent Allowance (HRA) = Usually 30% of Basic = 30% * 4.5 Lac = INR 1,35,000/-
• Conveyance Allowance = Usually INR 1600/- per month = 1600 * 12 = 19,200/- for a complete year
• Exgratia = CTC — Sum of above components = 9 Lac — 7.122 Lac = INR 1,87,800/—

Look at the below table for the summary of the above salary package components (CTC – INR 9 lakh)

Salary Components	Brief Description	Yearly Amount (INR)
Basic Salary	Typically 50% of your CTC	4,50,000/-
Employer’s Contribution to PF	12% of your Basic Salary	54,000/-
Employee’s Contribution to PF	12% of your Basic Salary	54,000/-
House Rent Allowance (HRA)	Usually 30% of Basic	1,35,000/-
Conveyance Allowance	Usually INR 1600/- per month	19,200/-
Exgratia	Rest part of your salary	1,87,800/-
Total CTC (INR)	Sum of above components	9,00,000/-

Now, Taxable Income = CTC — Standard Deduction – Employer’s Contribution to PF/NPS — Actual incurred Conveyance (Typically, To & fro travel to office cost)

Standard Deduction as per New Tax Regime 2024-25 has been increased from INR 50,000 to INR 75,000/-

Actual incurred Conveyance cost – Say INR 19,200/-

Taxable Income (INR) = 9,00,000 – 75,000 – 54,000 – 19,200 = 7,51,800/-

Tax Calculation on above taxable income (New Tax Regime) for FY 2024-2025

Income Slab (INR)	Tax Rate (New Tax Regime)	Break-up of above taxable income (INR 7,51,800)	Tax Amount (INR)
0 to 3,00,000	Nil	3,00,000	0
3,00,001 to 7,00,000	5%	4,00,000	20,000
7,00,001 to 10,00,000	10%	51,800	5,180
10,00,001 to 12,00,000	15%	–	–
12,00,001 to 15,00,000	20%	–	–
Above 15,00,000	30%	–	–
Total Income Tax Amount (A)			25,180
**Cess / Surcharge (B)			1,007
Total Tax Liability (A + B)			26,187
Rebate u/s Section 87	Applicable only when tax is less than 25k		0
Net Tax payable			26,187

Calculation of In hand salary (Take Home salary) from CTC would be as below —

In Hand salary = Total CTC — Employee’s Contribution to PF/NPS — Employer’s Contribution to PF/NPS — Net Tax Payable

In-Hand salary = 9 Lac — 54,000 — 54,000 — 26,187 = INR 7,65,813/- p.a. (INR 63,817/— per month)

Approx. INR 63.82k per month will be your In hand salary (Take Home Salary) if your CTC is INR 9 lakhs.

PAY ZERO TAX AND INCREASE YOUR IN HAND SALARY ALONG WITH INVESTING

Here’s how you can pay zero tax –

Ask your employer to deduct NPS around 2.6% of basic (i.e. 2.6% of 4.5 lacs = 11,700)

Now, Taxable Income = CTC — Standard Deduction – Employer’s Contribution to PF/NPS — Actual incurred Conveyance (Typically, To & fro travel to office cost)

Actual incurred Conveyance cost – Say INR 19,200/-

Taxable Income (INR) = 9,00,000 – 75,000 – 54,000 – 11,700 – 19,200 = 7,40,100/-

Income Slab (INR)	Tax Rate (New Tax Regime)	Break-up of above taxable income(INR 7,40,100)	Tax Amount (INR)
0 to 3,00,000	Nil	3,00,000	0
3,00,001 to 7,00,000	5%	4,00,000	20,000
7,00,001 to 10,00,000	10%	40,100	4,010
10,00,001 to 12,00,000	15%	–	–
12,00,001 to 15,00,000	20%	–	–
Above 15,00,000	30%	–	–
Total Income Tax Amount(A)			24,010
**Cess / Surcharge(B)			960
Total Tax Liability (A + B)			24,970
Rebate u/s Section 87	Applicable only when tax is less than 25k		25,000
Net Tax payable			0

Conclusion

With this guide, anyone can easily understand how to calculate their In hand salary from their CTC. We’ve provided a breakdown of salary calculations for the In hand salary salary under the New Tax Regime. However, it’s advisable also to compare the applicable income tax if you choose the Old Tax Regime to determine potential tax savings or you can consult your financial advisor.

If you still have any questions about calculating your In hand salary from your CTC, feel free to leave your queries in the comments section below.