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CTC (Cost to Company) is the total amount a company spends on an employee per year, including basic salary, HRA, allowances, employer PF contribution, insurance, bonuses, and other perks. In-hand salary (or take-home pay) is what you actually receive in your bank account after deducting employee PF, professional tax, and income tax (TDS). Typically, in-hand salary is 65-75% of CTC for most salaried employees in India.

Basic salary is typically 40-50% of CTC in most Indian companies. Some companies set it at 40% to reduce PF liability, while government and PSU jobs may have a higher basic. A higher basic means higher PF contribution (more retirement savings) but also higher taxable income. Most private sector companies in India keep basic at 40% of CTC as a standard practice.

Professional tax is a state-level tax deducted from salaried employees. The maximum limit is Rs 2,500 per year as per the Constitution. Not all states levy it — Karnataka, Maharashtra, West Bengal, Andhra Pradesh, Tamil Nadu, and a few others do. The employer deducts it from your salary and deposits it with the state government. It is deductible under Section 16(iii) of the Income Tax Act.

Under the new tax regime (default from FY 2023-24), you get lower tax rates but cannot claim most deductions like HRA, 80C, 80D, etc. The standard deduction is Rs 75,000. Tax slabs range from 5% (Rs 3-4L) to 30% (above Rs 15L). If your salary is under Rs 7 lakh, you pay zero tax due to Section 87A rebate. For salaries above Rs 10-12 lakh, compare both regimes — the old regime may be better if you have significant deductions.