1. What is Net Salary?

Net salary is the amount an employee takes home after all deductions. It's calculated by adding basic salary, allowances, and bonuses, then subtracting all deductions like taxes and insurance.

2. How Salary Calculation Works

The salary calculation formula is:

Where:

• Basic — Fixed component of salary
• Allowances — Additional payments (housing, transport, etc.)
• Bonuses — Performance-based payments
• Deductions — Taxes, insurance, loans, etc.

3. Components of Salary

Basic Salary: Core fixed amount before additions/deductions (usually 40-50% of CTC).
Allowances: Additional payments for specific purposes (housing, transport, medical).
Bonuses: Variable performance-based payments.
Deductions: Statutory (taxes) and voluntary (insurance, loans) reductions.

4. Using the Calculator

Instructions: Enter all amounts in your local currency. The calculator will sum your income components and subtract deductions to show net salary.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between gross and net salary?
A: Gross is total before deductions, net is take-home pay after deductions.

Q2: Are bonuses always included in salary?
A: Only guaranteed bonuses are included. Discretionary bonuses may vary.

Q3: What are common salary deductions?
A: Income tax, social security, health insurance, retirement contributions.

Q4: How often should I calculate my net salary?
A: Whenever there are changes to your pay structure or deduction amounts.

Q5: Can this calculator handle different currencies?
A: Yes, just ensure all amounts are in the same currency.