When your salary increases, your tax goes up too — and the increase is rarely linear. A 20% salary hike often delivers only 13-15% in your bank account once tax slabs, surcharge, and lost rebates kick in. This calculator shows the gross-to-net translation for any hike.
What is Salary Hike?
Indian income tax is progressive — each rupee crosses into a higher slab eventually. A salary hike that pushes you from the 20% to the 30% slab effectively taxes the increment at 30% plus 4% cess (31.2%), not your average rate. For high earners, surcharge tiers (10%-37%) add further non-linear effects, and just above the 87A rebate limit marginal relief tapers the tax instead of imposing it all at once.
This calculator answers what the actual take-home increase will be after a hike, helping you negotiate honestly and budget realistically. A 'huge raise' that lands you in a higher slab can be much smaller in real terms than the percentage suggests.
How the take-home hike is calculated
Compute current tax on current income at applicable slabs (old or new regime). Compute new tax on new income similarly. Net hike = (new income − new tax) − (current income − current tax). Express as percentage of current take-home for the real-impact figure.
The calculator handles the standard deduction, slab rates, surcharge tiers, and 87A rebate. For complex cases (capital gains, business income alongside salary), the result is approximate — use the full income tax calculator for those.
- Take-Home
- Net of tax—annual income minus annual income tax
How to use this calculator
Enter your current annual gross salary
Use gross before tax. Salaried CTC minus employer EPF (which doesn't reach you anyway) is roughly equivalent.
Enter the hike percentage or new salary
Either format works. Calculator computes the new gross from your input.
Choose the tax regime
New regime is default since FY 2023-24 and usually wins below ₹15-20L without major deductions. Old regime needs deductions (80C, 80D, HRA, home loan) to break even.
Read the real take-home hike
Calculator shows old take-home, new take-home, and the percentage increase in pocket money. Compare with the gross hike percentage to see the tax drag.
When to use it
Negotiating an offer
When evaluating a job offer with a 30% hike, run the calculator first. If the new salary crosses a slab boundary or pushes you into surcharge, the real take-home increase may be 18-22% — useful context for whether the move is worth other trade-offs.
Annual appraisal context
A 10% appraisal that fully crosses you from 20% to 30% slab translates to ~7% take-home increase. Knowing this helps with realistic lifestyle planning.
Comparing job offers
Two offers — ₹25L base vs ₹22L base + ₹6L stock vested over 4 years — have different tax profiles. Run each through the calculator to compare real take-home in year 1.
Common mistakes to avoid
Comparing gross hike to lifestyle plans
Lifestyle increases should be based on take-home, not gross. A 25% gross hike is often only 15-18% take-home — plan upgrades using the real number.
Ignoring incremental EPF
Higher salary means higher monthly EPF deduction (12% of basic). Real-world take-home is gross minus tax minus EPF. The calculator handles tax; for EPF, subtract the 12%-of-basic increase too.