Short answer
Employee PF is 12% of basic, or ₹1,800 a month when your employer uses the ₹15,000 wage ceiling. Professional tax is up to ₹2,500 a year in most states.
Provident fund (PF)
The Employees' Provident Fund is a retirement savings scheme. Both you and your employer contribute 12% of basic pay each month. Your share is deducted from your gross salary. The employer's share is part of your CTC but never appears in your monthly pay.
The ₹15,000 wage ceiling
Many employers calculate PF only on a wage of ₹15,000 a month, which gives a contribution of ₹1,800 a month from each side. Others calculate it on the full basic salary. The first approach leaves more cash in your hand today. The second builds a bigger retirement fund. The calculator lets you switch between them under More options.
How PF affects tax
In the old regime, your employee PF counts towards the ₹1.5 lakh limit of the 80C deduction. In the new regime, it gives no tax benefit. Employer contributions above ₹7.5 lakh a year (PF, NPS and superannuation together) are taxed as a perquisite.
Professional tax
Professional tax is charged by state governments on salaried people. Most states cap it at ₹2,500 a year, and some states do not charge it at all. The amount usually depends on your monthly salary, and the employer deducts it each month.
The calculator uses these approximate yearly amounts, and only when monthly gross pay crosses the state's threshold:
| State | Yearly amount | Applies from monthly gross |
|---|---|---|
| Maharashtra | ₹2,500 | ₹10,000 |
| Karnataka | ₹2,400 | ₹25,000 |
| Tamil Nadu | ₹2,500 | ₹12,500 |
| West Bengal | ₹2,400 | ₹40,000 |
| Telangana | ₹2,400 | ₹20,000 |
| Andhra Pradesh | ₹2,400 | ₹20,000 |
| Gujarat | ₹2,400 | ₹12,000 |
| Madhya Pradesh | ₹2,500 | ₹18,750 |
| Kerala | ₹2,500 | ₹12,500 |
| Odisha | ₹2,400 | ₹25,000 |
| Assam | ₹2,400 | ₹25,000 |
| Jharkhand | ₹2,500 | ₹40,000 |
| Chhattisgarh | ₹2,500 | ₹40,000 |
State slabs change and have extra rules, such as a higher deduction in one month, so confirm the exact figure on your payslip.
Putting it together
For a ₹12 lakh CTC with PF on the capped wage, employee PF is ₹1,800 a month and professional tax in Maharashtra is about ₹208 a month. Together they cost about ₹2,000 a month. With PF on full basic pay, the same salary loses ₹4,800 a month to PF alone.
See the effect on your own salary in the CTC to in-hand calculator.
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