A 20% hike on ₹10 LPA looks great — but after TDS and PF, your actual monthly take-home increase is significantly lower. Know the real number.
Salary Hike — Key Questions
How is salary hike percentage calculated?+
Hike % = ((New CTC - Old CTC) / Old CTC) × 100. For example, moving from ₹10 LPA to ₹12 LPA is a 20% hike. To calculate your new salary: New CTC = Current CTC × (1 + Hike%/100). The actual take-home increase is lower because PF contributions and income tax both increase with salary.
What is a good salary hike in India 2026?+
Average salary hikes in India in 2026 are 8-10% for average performers, 12-15% for good performers, and 20-30%+ for exceptional or promoted employees. IT sector averages 10-12%, BFSI 8-10%, FMCG 8-9%. A hike below inflation (currently 5-6%) is effectively a pay cut in real terms. Anything above 15% is considered above-market in most sectors.
Why is my actual take-home increase less than the hike percentage?+
Because both PF contributions (12% of basic) and income tax increase proportionally with your salary. A 20% CTC hike translates to roughly 13-17% actual take-home increase depending on your tax slab. Higher tax slab = smaller real take-home hike. This is the illusion of gross salary hike — always calculate net in-hand impact.