If you’re searching for a new salary structure calculator, you’re likely worried about one thing:
Will my take-home salary reduce under the new labour code?
Across India, employees and HR professionals are hearing conflicting claims:
- PF will increase for everyone
- 50% basic salary is now mandatory
- Salary structures will change overnight
Most of this information is incomplete or misleading.
The truth is simple:
👉 The impact depends on how your salary is structured and whether PF ceiling applies.
That’s exactly what this calculator helps you find out.
Use the calculator below to see:
- your net pay
- PF, ESI and gratuity impact
- employer vs employee contributions
- monthly and annual CTC
All based on real Indian payroll rules, not assumptions.
New Salary Structure Calculator: Fully Automatic
| Components | Values |
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Select State*: |
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Enter Gross Salary*: |
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Minimum Wage Basic: | |
Minimum Wage DA: | |
Special Allowance: | |
Basic Percentage: |
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HRA Percentage: |
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PF Ceiling: |
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Service Weightage: |
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Other Earning Components:
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- Customize the Earnings, Deductions, and CTC components as per your needs. Select the correct State for accurate professional tax.
- Enter any amount in the Gross Salary field. A slider will appear—use it to adjust until you reach your desired Net Pay or Monthly CTC.
Why Is Everyone Suddenly Talking About the “New Salary Structure”?
The term new salary structure does not mean that salaries are being reduced overnight or that every company must immediately change how it pays employees.
What’s driving the sudden interest is this:
- The new labour codes redefine “wages” more clearly
- Basic pay and certain allowances are expected to form a larger share of wages
- PF, gratuity and other statutory benefits are linked to this wage definition
This has created a widespread belief that PF deductions will increase and take-home salary will fall for everyone. That assumption is only partially true, and in many cases, completely wrong.
The reality depends on:
- how your salary is structured today
- whether your employer follows the PF ceiling
- your income level
- and how allowances are designed
That is exactly why a calculator is needed instead of assumptions.
Has the New Labour Code Been Implemented?
This is the most important clarification.
As of now:
- The labour codes have been passed and notified
- Full nationwide implementation is still pending
- States must frame and notify their own rules
- Employers are preparing, but timelines vary
So no, there is no sudden mandatory change that automatically alters your salary today.
However, companies are:
- proactively realigning salary structures
- preparing compliant CTC designs
- reworking offer letters for future hires
That makes understanding the new salary structure extremely relevant — even before formal enforcement.
What Does “New Salary Structure” Actually Mean?
In simple terms, it refers to how your total salary (CTC) is split into:
- Basic Pay
- HRA
- Allowances
- Statutory deductions (PF, ESI, PT, Income Tax)
- Employer contributions (PF employer share, gratuity, etc.)
Under the labour code framework:
- Basic Pay cannot be artificially suppressed
- Excessive allowance-heavy structures are discouraged
- Statutory benefits are calculated on a more realistic wage base
This does not automatically reduce salary. In many cases:
- CTC remains the same
- Take-home stays similar
- Only the internal breakup changes
But again, outcomes vary. Which is why estimation without calculation leads to panic.
Why You Should Use a Calculator (Not Guesswork)
Articles can explain concepts. Only a calculator can show your numbers.
With a proper New Salary Structure Calculator, you can:
- see PF impact with and without ceiling
- compare old vs revised structure
- estimate in-hand salary correctly
- understand employer vs employee contributions
- avoid relying on WhatsApp forwards or half-truths
That’s exactly what the calculator on this page is designed to do.
How This New Salary Structure Calculator Works
Before you start entering numbers, it’s important to understand what this calculator is designed to simulate.
This is not a generic salary calculator. It is built specifically to reflect salary structuring logic aligned with the new labour code wage definition, while still respecting how payroll actually works in India today.
That balance matters.
Many online tools either:
- blindly assume 50% basic for everyone, or
- ignore PF ceilings, state PT rules and real-world employer practices
This calculator avoids both extremes.
What This Calculator Assumes (Very Clearly)
The calculator works on monthly gross salary, because that is how most Indian payrolls are structured and how PF, ESI and PT are actually computed.
It allows you to:
- choose Basic % (commonly, 50%, or 60%)
- decide whether PF ceiling applies or not
- include or exclude gratuity, bonus, NH/NFH, leave wages
- add custom earnings and deductions
- calculate state-wise professional tax
- see employee vs employer contributions separately
In other words, it mirrors how HR and payroll teams build salary annexures in real organisations.
Labour Code Alignment Without Assumptions
A critical point to understand:
👉 The labour code does not say “everyone must have exactly 50% basic salary.”
What it does say is:
- wages should form a reasonable proportion of total remuneration
- allowances should not dominate salary structures
- statutory benefits must be calculated on compliant wage definitions
This calculator:
- lets you test 50% basic scenarios
- lets you compare them with existing structures
- shows the PF, gratuity and net pay impact instantly
You see outcomes, not opinions.
PF Ceiling: The Biggest Source of Confusion
This deserves special mention. Most fear around the new salary structure comes from PF.
Here’s the reality:
- Many employers still follow the ₹15,000 PF wage ceiling
- In such cases, PF does not increase, even if basic salary is higher
- Take-home salary remains largely unchanged
This calculator allows you to explicitly choose:
- PF ceiling = Yes (most common in India)
- PF ceiling = No (higher-wage PF, voluntary or policy-driven)
That single toggle explains why:
- some people see reduced take-home
- most people do not
What This Calculator Does NOT Do
Equally important.
This tool:
- does not predict your employer’s future policy
- does not enforce labour code implementation
- does not replace legal or tax advice
- does not assume salary reduction by default
It is an estimation and comparison tool, not a compliance enforcement engine.
Its job is to answer one question accurately:
“If my salary is structured this way, what will my take-home, deductions and CTC actually look like?”
Who Should Use This Calculator Right Now
This calculator is especially useful if you are:
- An employee worried about PF or take-home reduction
- A job seeker evaluating an offer under “new salary structure”
- An HR professional designing compliant salary breakups
- A startup or employer preparing future-ready CTC templates
- A recruiter explaining offers transparently to candidates
If you fall into any of these categories, guessing is risky. Calculation is safer.
Key Components in the New Salary Structure Explained
To understand the impact of the new salary structure, you need to look at each component separately. Most confusion comes from mixing them together.
Let’s break it down clearly.
1. Basic Salary: The Foundation of Everything
Basic salary is the most important component in any Indian salary structure.
Why? Because it directly affects:
- Provident Fund (PF)
- Gratuity
- Bonus eligibility
- Leave-related benefits
- Sometimes ESI calculations
Under the labour code framework, wages should form a meaningful portion of total pay. In practice, many organisations are aligning Basic around 40%–50% of Gross Salary.
Important clarity:
- There is no universal rule that Basic must be exactly 50%
- Employers may still choose 40%, 45% or 60%
- The impact depends on PF ceiling and benefits structure
This calculator lets you select the Basic percentage and immediately see how PF, gratuity and net pay change.
2. Dearness Allowance (DA): Mostly Zero in Private Sector
DA exists mainly in:
- government jobs
- PSU pay structures
- some legacy industrial setups
In most private companies:
- DA is either zero
- or merged into Basic or allowances
The calculator supports both cases:
- DA = 0 (default private-sector scenario)
- DA entered separately if applicable
This ensures accuracy without forcing artificial components.
3. House Rent Allowance (HRA): Flexible but Regulated
HRA is one of the most misunderstood parts of salary.
What matters:
- HRA is usually calculated as a % of Basic (or Basic + DA)
- Many employers keep it between 40%–50% of Basic
- HRA cannot be arbitrarily low if salary structure is compliant
The calculator:
- auto-adjusts HRA based on Basic %
- flags cases where HRA becomes unrealistically low
- ensures gross salary arithmetic always balances
This prevents negative or illogical breakups, which many online tools ignore.
4. Other Allowances: Where Most Structuring Happens
This is where companies actually optimise salary.
Other allowances may include:
- special allowance
- flexible benefits
- conveyance or travel allowance
- communication allowance
- performance-linked components
Under labour code principles:
- allowances cannot overwhelmingly dominate wages
- but they are still allowed and commonly used
The calculator:
- lets you add multiple custom earning components
- keeps total gross intact
- shows their effect on take-home clearly
This mirrors how real HR teams design offers.
5. Provident Fund (PF): The Real Impact Area
PF is the reason most people search for “new salary structure calculator”.
Key facts:
- Employee PF = 12% of Basic + DA
- Employer PF ≈ 13% (including admin charges)
- PF ceiling of ₹15,000 is still widely followed
This creates two very different outcomes:
Case 1: PF Ceiling Applied (Most Employees)
- PF deduction remains capped at ₹1,800
- Employer PF capped around ₹1,950
- Take-home salary usually does not reduce
Case 2: No PF Ceiling (Higher-Wage or Voluntary)
- PF increases with Basic
- Employer cost increases
- Take-home salary reduces
This calculator allows you to switch between both scenarios, so you see reality, not fear-driven assumptions.
6. Employee State Insurance (ESI)
ESI applies only when:
- Gross salary is ₹21,000 or below
Contribution rates:
- Employee: 0.75%
- Employer: 3.25%
If salary exceeds the threshold:
- ESI becomes zero automatically
The calculator handles this logic dynamically, state by state.
7. Professional Tax (PT): State-Wise Reality
Professional Tax:
- differs by state
- depends on monthly salary slabs
- is often overlooked in calculators
This tool:
- applies PT rules based on selected state
- shows zero where PT is not applicable
- reflects actual monthly deduction, not generic values
This makes the net pay figure far more realistic.
8. Gratuity: Part of CTC, Not Take-Home
Gratuity is:
- an employer-paid benefit
- payable after eligibility (usually 5 years)
- often shown as ~4.81% of Basic in CTC
Important point:
- Gratuity does not reduce take-home salary
- It only affects employer cost and CTC
The calculator:
- shows gratuity separately
- includes it in CTC
- keeps it out of net pay
Exactly how offer letters should show it.
Why This Component-Level View Matters
When you see salary as components instead of a lump sum:
- fear reduces
- decisions improve
- comparisons become fair
This is the core value of a good salary calculator
New Salary Structure: Real Scenarios Explained
Let’s move away from theory and look at practical situations. This is where most myths around the new labour code get cleared.
Scenario 1: Fresher or Entry-Level Employee
Typical profile
- Gross salary: ₹20,000–₹30,000 per month
- PF ceiling: usually applied
- ESI: often applicable
- Basic: 40%–50% of gross
What actually happens
- PF deduction is capped (₹1,800 or less)
- Employer PF is also capped
- ESI applies only if salary ≤ ₹21,000
- Net pay remains largely unchanged
Key takeaway
For freshers, the new salary structure does not reduce take-home pay in most cases. It mainly improves transparency and compliance.
Scenario 2: Mid-Level Professional (₹6–10 LPA)
Typical profile
- Gross salary: ₹45,000–₹80,000 per month
- PF ceiling: applied in most companies
- ESI: not applicable
- Basic: often moved closer to 50%
What actually happens
- PF remains capped at ₹1,800
- Employer PF around ₹1,950
- Gratuity appears in CTC
- Net pay stays almost the same
Common misconception
Many believe that increasing Basic automatically reduces take-home salary.
In reality:
- PF stays capped
- Only CTC composition changes
- Take-home impact is minimal or zero
This is exactly what the calculator demonstrates in seconds.
Scenario 3: High-Salary Employee (No PF Ceiling)
Typical profile
- Senior roles or specialised professionals
- Employer does not apply PF ceiling
- PF calculated on actual Basic
- Often chosen for tax planning or retirement savings
What actually happens
- PF deduction increases
- Employer cost increases
- Take-home salary reduces slightly
- Long-term savings increase
Important clarity
This reduction is not due to the labour code.
It is a policy choice:
- by the employer
- or by the employee (via voluntary higher PF)
The calculator allows you to toggle this and see both outcomes clearly.
Scenario 4: HR / Payroll Structuring a Salary
For HR teams and founders, the calculator serves a different purpose.
It helps to:
- design compliant salary structures
- balance take-home vs CTC
- ensure minimum wage alignment
- avoid audit or inspection issues
Using this tool:
- reduces manual Excel work
- avoids arithmetic errors
- creates consistent annexures
This is why many HR professionals use such calculators internally before issuing offers.
Why Most People Panic Unnecessarily
The fear around the new salary structure usually comes from:
- half information on social media
- incorrect assumptions about PF
- mixing up Gross and CTC
- ignoring the PF ceiling reality
A calculator that shows Gross → Net → CTC clearly removes this confusion.
Why This New Salary Structure Calculator Is Different
Most online salary calculators stop at simple math. They don’t explain why a number appears or whether it is legally correct.
This calculator is different because it is built around real Indian payroll rules, not assumptions.
What makes it reliable
- Reflects PF ceiling logic
- Applies state-wise Professional Tax
- Handles ESI eligibility correctly
- Separates Gross, Net Pay and CTC
- Shows employer vs employee contributions clearly
This makes it useful not only for employees, but also for HR and payroll professionals.
Compliance First, Not Guesswork
Salary structures in India are governed by multiple laws:
- EPF & Miscellaneous Provisions Act
- Employees’ State Insurance Act
- Payment of Gratuity Act
- Income Tax Act
- State-specific Professional Tax rules
This tool ensures:
- no statutory component is ignored
- no illegal structure is created unknowingly
- minimum wage logic can be respected when needed
That’s why the output reads like a salary annexure, not just a calculation.
Common Questions About the New Salary Structure
Will my take-home salary reduce because of the new labour code?
For most employees, no.
If the PF ceiling of ₹15,000 is applied (which is common in India), Provident Fund deductions remain capped and take-home salary usually stays the same.
Why does gratuity appear in CTC?
Gratuity is an employer-paid benefit, not monthly cash paid to employees.
It appears in CTC for transparency because it is a future statutory cost for the employer, not because it is paid every month.
Is higher PF mandatory under the new labour code?
No. Provident Fund on actual salary applies only if:
- The employer removes the PF wage ceiling, or
- The employee opts voluntarily for higher PF (VPF)
The labour code does not force higher PF contributions for everyone.
Is this calculator suitable for offer letter review?
Yes. This calculator is especially useful for:
- Comparing multiple job offers
- Verifying salary breakups shared by HR
- Negotiating allowances and PF structure
Who should use this new salary structure calculator?
This calculator is ideal for:
- Job seekers reviewing offer letters
- Working professionals checking salary slips
- HR and payroll teams designing compliant salary structures
- Founders and startups creating CTC models
- Consultants and trainers explaining salary concepts
If salary clarity matters to you, this calculator saves time and confusion.
Final Verdict on the New Salary Structure
The new salary structure under the labour code is not a threat. It is a move toward clarity and compliance.
For most people:
- take-home pay remains stable
- PF rules remain familiar
- confusion comes from misinformation, not law
Tools like this calculator help you see facts instead of assumptions.
Use the Calculator Above to See Your Exact Impact
Instead of guessing:
- enter your gross salary
- choose your state
- adjust PF and components
- see your net pay instantly
No login. No email. No hidden agenda. Just clear numbers.
Conclusion
Understanding salary structure should not require a payroll degree.
This New Salary Structure Calculator simplifies:
- complex labour rules
- statutory deductions
- employer cost vs employee pay
Updated for FY 2025–26, this tool gives you clarity, confidence, and compliance in one place.
If you are evaluating a job offer, negotiating pay, or simply trying to understand your salary better, this calculator is the right place to start.