Change CTC to Increase In-Hand Salary India

Use conveyance, medical, telephone, education, HRA, LTA, training, qualification allowances to change CTC - increase your in-hand salary.

Written by Anil Gupta
  Anil Gupta    Updated 31 May, 20

You can negotiate and restructure your CTC (the cost to company) in India which can help reduce your income tax thereby increasing your in-hand salary.

CTC components like Basic pay, HRA, LTA, Food coupons, medical, and conveyance allowance help you reduce tax automatically.

There are 2 ways to increase your take-home pay with the ultimate aim of reducing the total tax that goes out from your pocket:

  • Maximize income tax exemptions on investment and expenses.
  • Restructure your salary package to get more tax benefits.

Taxes are applicable to most aspects of our salary and we can do nothing about it except making use of the tax rebates to minimize the taxes as much as possible. We have created an app that analyzes your salary components (CTC components) and advises you on how you can effectively increase your take-home pay by using the above two methods.

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This helpful Indian salary calculator uses an intuitive method and calculates your tax liability considering the various options you choose and guides you to what exactly can be done to minimize your taxes resulting in increased take-home pay.

Let us consider a few components which can be used to reduce the tax liability on our salary income:-

#1 Allowances/ Reimbursements

Allowances are normally paid irrespective of the employee actually incurring them. These are fully taxable if no bills are provided.

However, if the expenses are incurred and bills provided, they are not taxable up to a specified limit under each head.


  • Mobile Bills
  • Home Internet
  • Car Maintenance

#2 Conveyance

For conveyance, up to Rs. 1600 per month is allowed as deduction without providing any bills. Add this component to your CTC if missing to the maximum amount.

#3 Medical Allowance

Medical bills including over-the-counter medicines are allowed as deduction. You can claim medical expenses up to a maximum limit.

You can claim medical bills paid for self, spouse, children, parents, and siblings who are dependent on the employee.

#4 Leave and Travel Allowance

Indian laws allow you to have two trips in a block of 4 years. These are covered under LTA – Leave Travel Allowance.

If you only travel within India, you can claim expenses as a deduction from your taxable income.

It can be claimed for self, spouse, children, parents but only if the employee is traveling along with them. There is no maximum limit on this, but the un-utilized amount will be paid once the block is completed (after deducting taxes).

#5 Education, Qualification, Training, Telephone Allowance

These allowances are tax free upto a certain amount or an amount that your employer is ready to reimburse for you.

Many executive level employees are given these allowances as part of their packages.

#6 HRA – House Rent Allowance

House Rent Allowance can be claimed if one lives in rented premises and the rent exceeds 10% of the salary. The actual HRA exempted from tax is calculated based on clever income tax rules.

Use this app to find the best amount of rent that can fetch you maximum amount of tax reduction.

Indian HRA Tax Calculator


Written by Anil Gupta
  Anil Gupta  
Mentor | Immigration and Finance Journalism | Humor | Opinions are my own