What is CTC (cost to company)?
Short answer
CTC is the total yearly cost an employer bears for an employee: gross pay plus the employer’s own contributions and benefits. Take-home pay is lower than CTC.
CTC and take-home
- Gross pay is basic, HRA and allowances before deductions.
- Take-home pay is gross pay minus the employee’s PF, ESIC, professional tax and TDS, plus any one-off pay.
- Employer contributions such as PF and ESIC are a cost to the company but are not part of what the employee receives each month.
In AdviHR
AdviHR’s salary structure document shows CTC as the sum of basic, HRA and special allowance, with employer contributions listed separately for information.
Frequently asked questions
Why is my in-hand salary lower than CTC?
Employer contributions and benefits are inside CTC but are not paid to you monthly, and your own PF, ESIC, professional tax and TDS are deducted from gross pay.
Related terms
How sure are we? These figures use the same rules AdviHR payroll applies. We publish what has been checked against an official source and what has not, on the statutory accuracy page.
General information, not legal or tax advice. Confirm against the official notification and your adviser.