Salary Slip Format —
Components, CTC vs Take-Home
Every earning and deduction on an Indian salary slip, the taxability of each component under the old and new regimes, and how CTC, gross and net take-home actually differ — with a worked FY 2025-26 example.
A salary slip (pay slip) lists your monthly earnings (Basic, HRA, DA, allowances) and deductions (Employee PF at 12% of Basic+DA, professional tax, TDS, ESI). Net take-home = Gross earnings − Total deductions. There is no legally fixed format, but the slip must match your Form 16 and EPF records. CTC is larger than take-home — it also loads the employer's PF, gratuity provision and insurance, which you never receive as cash.
CTC (Cost to Company) includes employer costs you never see as cash — employer PF (12% of Basic+DA), gratuity provision (~4.81% of basic) and group insurance. As a rough guide, gross take-home is roughly CTC ÷ 1.15–1.25 depending on your PF and benefit structure.
Standard Salary Slip Components
A typical private-sector salary slip in India carries the components below. Government and PSU slips often add Dearness Allowance (DA), Transport Allowance and city-compensatory allowances.
| Component | What it is | Taxability (FY 2025-26) |
|---|---|---|
| Basic Salary | Usually 40–50% of CTC; base for PF and gratuity | Fully taxable |
| HRA | 40% (non-metro) / 50% (metro) of basic | Exempt u/s 10(13A) — old regime only |
| Dearness Allowance (DA) | CPI-linked; common in govt/PSU | Fully taxable |
| Special Allowance | Balancing / role top-up | Fully taxable |
| LTA | Leave Travel Allowance for domestic travel | Exempt u/s 10(5), 2 trips per 4-yr block — old only |
| Employee PF | 12% of Basic+DA (deduction) | 80C eligible (old regime); reduces take-home |
| Professional Tax | State levy, max Rs 2,500/yr (deduction) | Deductible u/s 16(iii) — both regimes |
| Income Tax (TDS) | Monthly u/s 192 on estimated salary | Credited in Form 26AS / AIS |
| ESI | 0.75% of wages if gross ≤ Rs 21,000/mo | No separate income-tax deduction |
The old flat Rs 15,000 medical allowance and Rs 19,200 transport-allowance exemptions were replaced by the standard deduction from FY 2018-19.
Which Salary Components Stay Exempt?
The new tax regime is the default from FY 2023-24. It drops almost every salary exemption but gives a higher standard deduction. Most classic allowance exemptions survive only if you opt for the old regime.
Old regime — exemptions available
- HRA exemption u/s 10(13A)
- LTA exemption u/s 10(5)
- Standard deduction Rs 50,000
- 80C, 80D, 80CCD(1B), 24(b) home-loan interest
- Best when rent + deductions are high
New regime (default)
- HRA & LTA exemptions NOT available
- Standard deduction Rs 75,000 (higher)
- Only 80CCD(2) employer NPS & 80JJAA allowed
- Rebate u/s 87A up to Rs 12L taxable income
- Simpler — best with few deductions
If you claim HRA or LTA exemption you must be on the old regime. In the new regime the full HRA and LTA are taxable, but the Rs 75,000 standard deduction and lower slab rates often still win for taxpayers who do not pay high rent. Compare both before choosing.
Not sure which regime saves you more on your salary?
Compare with an expert →Sample Salary Slip Calculation
Mid-level employee in a metro city, gross earnings ~Rs 75,000/month. This shows how gross becomes net take-home after standard payroll deductions.
| Line item | Amount / month |
|---|---|
| Basic Salary | Rs 40,000 |
| HRA (50% of basic — metro) | Rs 20,000 |
| Special Allowance | Rs 15,000 |
| Gross Earnings | Rs 75,000 |
| Less: Employee PF (12% of Rs 40,000) | − Rs 4,800 |
| Less: Professional Tax | − Rs 200 |
| Less: Income Tax TDS (estimate) | − Rs 3,500 |
| Net Take-Home | Rs 66,500 |
CTC for this employee is higher (~Rs 82,000–90,000): gross Rs 75,000 + employer PF Rs 4,800 + gratuity provision ~Rs 1,600 + insurance + other benefits.
Gross to net (monthly)
CTC build-up (monthly)
CTC vs Gross Salary vs Net Salary
| Measure | What it includes | Where you see it |
|---|---|---|
| CTC | Gross + employer PF + gratuity provision + insurance + perquisites | Offer letter / appraisal |
| Gross Salary | Basic + HRA + DA + all allowances (before deductions) | Top of salary slip |
| Net / Take-Home | Gross − PF − professional tax − TDS − ESI | Credited to bank |
Quick formula: Net take-home = Gross − Employee PF − Professional Tax − TDS − ESI.
EPF on your slip
The employee PF deduction on your slip is 12% of Basic+DA; the employer contributes another 12% (split between EPF and EPS). EPF earned 8.25% for FY 2025-26 (EPFO-ratified). Interest on your own EPF contribution above Rs 2.5 lakh a year is taxable, and EPF withdrawal is taxable if you have less than 5 years of continuous service. See our PF withdrawal guide.
Your total salary slips for the year should tie to your Form 16, and the TDS deducted should appear in Form 26AS / AIS on the income-tax portal. Mismatches usually come from a mid-year regime change, bonus/arrears, or last-quarter TDS trueing-up — reconcile before you file.
- Employer name, address & your employee ID
- Pay period (month and year)
- All earnings — Basic, HRA, DA, allowances
- All deductions — PF, PT, TDS, ESI
- Gross salary and net take-home
- Standard deduction applied (Rs 75,000 new / Rs 50,000 old)
- Slip matches Form 16 & EPF passbook
- TDS appears in Form 26AS / AIS
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