At this salary
- Taxable income is ₹35,88,846; your top slab rate is 30% and tax is 17.1% of CTC under the new regime.
- If your employer caps PF at the ₹25,000 ceiling, your PF falls from ₹20,000 to ₹3,000 a month and in-hand rises to ₹2,57,106.
- The old regime only beats the new one if you claim more than ₹6,50,000 of extra deductions (HRA, s.123 beyond your PF, s.126, home loan interest).
Employer NPS: the one big deduction left in the new regime
If your employer restructures 14% of basic (₹23,333 a month) into NPS, it is deductible under section 124(1) and your new-regime tax falls by ₹87,360 a year. The money goes to your NPS account instead of your salary, so in-hand drops but total wealth rises.
Bonuses and RSUs at this salary
Taxable income is ₹14.11 lakh below ₹50 lakh, where a 10% surcharge starts (with marginal relief at the threshold).
A ₹5 lakh RSU vest or bonus on top of this salary would add about ₹1,56,000 of tax (31.2%).
What the next ₹1 lakh of CTC is worth
Moving from ₹40 lakh to ₹41 lakh adds ₹57,016 a year to your in-hand (₹4,751 a month). Of the extra ₹1 lakh, ₹28,580 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 | ₹1,66,667 | ₹1,66,667 |
| HRA | ₹66,667 | ₹66,667 |
| Special allowance | ₹71,987 | ₹71,987 |
| Gross salary | ₹3,05,321 | ₹3,05,321 |
| Your PF | −₹20,000 | −₹20,000 |
| Income tax (TDS) | −₹56,910 | −₹73,810 |
| In-hand (before professional tax) | ₹2,28,411 | ₹2,11,511 |
Yearly tax on ₹40 LPA
| Step | New regime | Old regime |
|---|---|---|
| Gross salary | ₹36,63,846 | ₹36,63,846 |
| Deductions | −₹75,000 | −₹2,00,000 |
| Taxable income | ₹35,88,846 | ₹34,63,846 |
| Tax on slabs | ₹6,56,655 | ₹8,51,655 |
| Rebate (s.156) | −₹0 | −₹0 |
| Cess (4%) | ₹26,266 | ₹34,066 |
| Total tax | ₹6,82,920 | ₹8,85,720 |
Old regime deductions counted: Standard deduction ₹50,000; s.123 (old 80C), incl. your PF ₹1,50,000. To match the new regime, you would need ₹6,50,000 more in deductions.
Professional tax on ₹40 LPA, by state
| State | Per month | Per year | In-hand (new regime) |
|---|---|---|---|
| Telangana | ₹200 | ₹2,400 | ₹2,28,211 |
| West Bengal | ₹200 | ₹2,400 | ₹2,28,211 |
| Gujarat | ₹200 | ₹2,400 | ₹2,28,211 |
| Maharashtra | ₹200 | ₹2,500 | ₹2,28,211 |
| Karnataka | ₹200 | ₹2,500 | ₹2,28,211 |
| Madhya Pradesh | ₹208 | ₹2,500 | ₹2,28,203 |
PF on ₹40 LPA
| PF calculated on | Your PF a month | In-hand (new regime) |
|---|---|---|
| Full PF wage (₹1,66,667) | ₹20,000 | ₹2,28,411 |
| Statutory ceiling (₹25,000) | ₹3,000 | ₹2,57,106 |
Worked example
Fixed monthly CTC ₹3,33,333: basic ₹1,66,667 (50%), HRA ₹66,667, employer PF ₹20,000, gratuity ₹8,013, leaving a special allowance of ₹71,987. Gross salary ₹3,05,321 a month, or ₹36,63,846 a year. After the ₹75,000 standard deduction, taxable income is ₹35,88,846 and tax is ₹6,82,920. Monthly in-hand: ₹3,05,321 − ₹20,000 PF − ₹56,910 TDS = ₹2,28,411.
Neighbouring salaries
| CTC | In-hand a month (new regime) |
|---|---|
| ₹25 LPA | ₹1,56,336 |
| ₹30 LPA | ₹1,80,895 |
| ₹35 LPA | ₹2,04,653 |
| ₹40 LPA | ₹2,28,411 |
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).
- Use the calculator above to match your offer letter.