CTC vs. In-Hand Salary: Understanding Your True Earnings

• CTC (Cost To Company) is the total annual expenditure by an employer on an employee, encompassing direct salary, indirect benefits, and mandatory contributions like EPF and Gratuity.
• CTC often includes Performance Linked Incentives or bonuses, which are contingent on meeting specific targets, making it a maximum potential figure.
• In-Hand Salary is the actual amount credited to your bank account monthly, after all statutory deductions, taxes, and other company-specific deductions (e.g., health insurance premiums for dependents, loan EMIs) are removed.
• Items like food coupons, gym memberships, or leased car facilities are added to CTC as they represent a financial cost to the company.
• Tax Deducted at Source (TDS) is withheld by the employer from your salary and paid to the government based on the income tax slab system.