At this salary
- No income tax under the new regime: taxable income of ₹1,44,831 (after the ₹75,000 standard deduction) is within the ₹12 lakh rebate limit of section 156.
- No professional tax at this salary in Karnataka, Madhya Pradesh; up to ₹2,500 a year elsewhere.
- The old regime is already no costlier here, even without extra deductions.
How far you are from paying income tax
With this salary structure, a CTC up to about ₹13.91 lakh pays no income tax under the new regime. You have roughly ₹11.51 lakh of raises left before tax starts.
If your employer contributes 14% of basic to NPS (deductible under section 124(1) even in the new regime), the tax-free CTC rises to about ₹15.07 lakh.
PF is your biggest deduction
With no income tax at this salary, your own PF of ₹1,200 a month (6.0% of CTC) is the main thing between gross and in-hand, along with professional tax in some states.
Your PF wage of ₹10,000 is at or below the ₹25,000 ceiling, so capping PF at the ceiling would not lower it.
What the next ₹1 lakh of CTC is worth
Moving from ₹2.4 lakh to ₹3.4 lakh adds ₹85,596 a year to your in-hand (₹7,133 a month). Of the extra ₹1 lakh, ₹0 goes to income tax and the rest to PF, gratuity and employer PF.
Monthly payslip: new vs old regime
Typical month from September 2026, no professional tax, no extra old-regime deductions.
| Item | New regime | Old regime |
|---|---|---|
| Basic | ₹10,000 | ₹10,000 |
| HRA | ₹4,000 | ₹4,000 |
| Special allowance | ₹4,319 | ₹4,319 |
| Gross salary | ₹18,319 | ₹18,319 |
| Your PF | −₹1,200 | −₹1,200 |
| Income tax (TDS) | ₹0 | ₹0 |
| In-hand (before professional tax) | ₹17,119 | ₹17,119 |
Yearly tax on ₹20,000 a month
| Step | New regime | Old regime |
|---|---|---|
| Gross salary | ₹2,19,831 | ₹2,19,831 |
| Deductions | −₹75,000 | −₹64,400 |
| Taxable income | ₹1,44,831 | ₹1,55,431 |
| Tax on slabs | ₹0 | ₹0 |
| Rebate (s.156) | −₹0 | −₹0 |
| Cess (4%) | ₹0 | ₹0 |
| Total tax | ₹0 | ₹0 |
Old regime deductions counted: Standard deduction ₹50,000; s.123 (old 80C), incl. your PF ₹14,400.
Professional tax on ₹20,000 a month, by state
| State | Per month | Per year | In-hand (new regime) |
|---|---|---|---|
| Karnataka | ₹0 | ₹0 | ₹17,119 |
| Madhya Pradesh | ₹0 | ₹0 | ₹17,119 |
| West Bengal | ₹130 | ₹1,560 | ₹16,989 |
| Telangana | ₹150 | ₹1,800 | ₹16,969 |
| Gujarat | ₹200 | ₹2,400 | ₹16,919 |
| Maharashtra | ₹200 | ₹2,500 | ₹16,919 |
PF on ₹20,000 a month
| PF calculated on | Your PF a month | In-hand (new regime) |
|---|---|---|
| Full PF wage (₹10,000) | ₹1,200 | ₹17,119 |
| Statutory ceiling (₹25,000) | ₹1,200 | ₹17,119 |
Worked example
Fixed monthly CTC ₹20,000: basic ₹10,000 (50%), HRA ₹4,000, employer PF ₹1,200, gratuity ₹481, leaving a special allowance of ₹4,319. Gross salary ₹18,319 a month, or ₹2,19,831 a year. After the ₹75,000 standard deduction, taxable income is ₹1,44,831 and tax is ₹0. Monthly in-hand: ₹18,319 − ₹1,200 PF − ₹0 TDS = ₹17,119.
Neighbouring salaries
| CTC | In-hand a month (new regime) |
|---|---|
| ₹15,000 a month | ₹12,839 |
| ₹20,000 a month | ₹17,119 |
| ₹25,000 a month | ₹21,399 |
| ₹30,000 a month | ₹25,679 |
| ₹4 LPA | ₹28,532 |
Assumptions
- Basic 50% of fixed CTC, HRA 40% of basic, employer PF and gratuity inside CTC, PF on the full basic, no variable pay.
- PF and gratuity wages follow the Labour Code 50% rule (it does not change anything at a 50% basic).
- “₹20,000 a month” is read as monthly CTC (₹2.4 lakh a year). Use the calculator above to match your offer letter.