DoubleTaxationTaxes on salary: India
How much tax and social security is paid on a salary in India, what is left as take-home pay, and which special tax regimes exist.
Calculation for a gross salary of €60,000 per year
| Gross salary | ₹6,343,140 ≈ €60,000 |
|---|---|
| Income tax | |
| Income-tax | ₹1,460,442 ≈ €13,814 |
| Surcharge | ₹146,044 ≈ €1,381 |
| Health and Education Cess | ₹64,259 ≈ €608 |
| Employee contributions | |
| Employees' Provident Fund (employee) | ₹29,360 ≈ €278 |
| Take-home pay | ₹4,643,034 ≈ €43,919 |
| Employer contributions and payroll taxes | |
| Employees' Provident Fund (employer) | ₹8,979 ≈ €85 |
| Employees' Pension Scheme | ₹20,381 ≈ €193 |
| Employees' Deposit Linked Insurance Scheme | ₹1,223 ≈ €12 |
| Employer's labour cost | ₹6,373,723 ≈ €60,289 |
Only some of the country's direct taxes and levies are counted: income tax on wages and compulsory contributions. Not counted: property and real-estate taxes; taxes on dividends, interest and other investment income; inheritance and gift taxes; indirect taxes such as VAT, excise and customs duties.
This country is not covered by OECD Taxing Wages; the calculation is ours, using the same methodology.
Special tax regimes
These regimes are not included in the calculation above: each has its own conditions.
Optional (old) tax regime — opting out of section 202
Who: Individuals who opt out of s. 202 (those with business income face limits on switching back).
Rates 0% to INR 2.5 lakh, 5% to 5 lakh, 20% to 10 lakh, 30% above; standard deduction INR 50,000, rebate up to INR 12,500 for income up to 5 lakh; investment, insurance and housing deductions available; surcharge up to 37% above 5 crore.
Presumptive taxation of business — section 58, Table Sl. No. 1 (former s. 44AD)
Who: Resident individuals, HUFs and firms (not LLPs) with turnover up to INR 2 crore (3 crore if cash receipts are 5% or less); not for specified professions, commission or agency business.
Profit deemed at 6% of digital and 8% of other turnover (or actual, if higher), no books required; ordinary rates then apply.
Legal basis: Income-tax Act, 2025, s. 58(2) Table Sl. No. 1, s. 58(7)–(8), (11)(a); s. 408(2)
Presumptive taxation of professions — section 58, Table Sl. No. 3 (former s. 44ADA)
Who: Resident individuals and firms (not LLPs) in specified professions (legal, medical, engineering, architecture, accountancy, technical consultancy, etc.) with gross receipts up to INR 50 lakh (75 lakh if cash is 5% or less).
Profit deemed at 50% of gross receipts (or actual, if higher); ordinary s. 202 or old-regime rates then apply.
Legal basis: Income-tax Act, 2025, s. 58(2) Table Sl. No. 3, s. 58(3), s. 58(11)(b), s. 62(4); s. 408(2)
Resident but not ordinarily resident (RNOR)
Who: Residents who were non-resident in 9 of the 10 preceding tax years or in India 729 days or less in the 7 preceding years; also certain citizens/PIOs with income over INR 15 lakh (120–181 days) and deemed-resident citizens.
Taxed on income received or accruing in India; foreign income only if from a business controlled from or a profession set up in India; typically 2–3 years for newcomers.
Legal basis: Income-tax Act, 2025, s. 6(13), s. 6(7), s. 263(1)(a)
Tax residence
When India treats you as a tax resident
- You were in India for 182 days or more in this tax year — you are resident in India under s. 6(2)(a) of the Income-tax Act, 2025. As a resident and ordinarily resident, India taxes your worldwide income (s. 5(1)).
- You were in India for 182 days or more — you are resident in India (s. 6(2)(a)), but not ordinarily resident (RNOR, s. 6(13)(a)) because of your past years. India taxes income received or arising in India, and foreign income only if it comes from a business controlled in or a profession set up in India (s. 5(1)(c)).
- You were in India for 182 days or more — you are resident in India (s. 6(2)(a)). Whether you are ordinarily resident depends on your past years (non-resident in 9 of the 10 preceding tax years, or 729 days or fewer in the 7 preceding years, makes you RNOR); until you check, assume India taxes your worldwide income.
- You were in India for 60 days or more this tax year and 365 days or more in the four preceding years — you are resident in India under s. 6(2)(b). As a resident and ordinarily resident, India taxes your worldwide income (s. 5(1)).
- You were in India for 60 days or more this tax year and 365 days or more in the four preceding years — you are resident (s. 6(2)(b)), but not ordinarily resident (RNOR, s. 6(13)(a)). India taxes income received or arising in India, and foreign income only if it comes from a business controlled in or a profession set up in India (s. 5(1)(c)).
- You were in India for 60 days or more this tax year and 365 days or more in the four preceding years — you are resident in India (s. 6(2)(b)). Whether you are ordinarily resident depends on your past years; until you check, assume India taxes your worldwide income.
- As an Indian citizen or person of Indian origin visiting India with income other than foreign-source income above ₹15 lakh, you spent 120 days or more in India this tax year and 365 days or more in the four preceding years — you are resident (s. 6(2)(b) read with s. 6(5)) and, by law, not ordinarily resident (s. 6(13)(b)). India taxes income received or arising in India, and foreign income only if it comes from a business controlled in or a profession set up in India (s. 5(1)(c)).
- You are an Indian citizen with income other than foreign-source income above ₹15 lakh and are not liable to tax in any other country by reason of domicile or residence — you are deemed resident in India (s. 6(7)) and, by law, not ordinarily resident (s. 6(13)(c)). India taxes income received or arising in India, and foreign income only if it comes from a business controlled in or a profession set up in India (s. 5(1)(c)).
Assumptions
- Calculated with the OECD Taxing Wages methodology: income tax including local taxes plus employee social security; single person without children, tax year 2026, ECB rate of 2 January 2026.
- Tax year 2026-27 (1 Apr 2026–31 Mar 2027) under the Income-tax Act, 2025, which replaced the 1961 Act from 1 April 2026; default new regime under s. 202.
- India is not in OECD Taxing Wages: mandatory EPFO contributions (EPF, EPS, EDLI) included. Employee is an EPF member; contributions only up to the statutory wage ceiling: INR 15,000/month to 16 Sep 2026, INR 25,000/month from 17 Sep 2026 (September pro rata by days). Contributions above the ceiling are voluntary and excluded.
- Basic wage (basic + DA) at least the ceiling — under the Code on Wages it must be at least 50% of remuneration, so contributions are at the ceiling for our profiles.
- No professional tax in Delhi. EPFO administrative charges (0.5%) excluded as a service fee, not a contribution.
- Local taxes — location: New Delhi
- Tax period: 2026-04-01 – 2027-03-31
- Exchange rate: 1 EUR = 105.719 INR (ECB euro foreign exchange reference rate, 2026-01-02)
Sources
- Income-tax Act, 2025, s. 202(1) — slabs 4/8/12/16/20/24 lakh (Indian Kanoon text)
- Income-tax Act, 2025, s. 19(1) Table Sl. No. 2 — standard deduction 75 000 (s. 202) / 50 000
- Income-tax Act, 2025, s. 156(2), (3) — rebate up to 60 000 for income up to 12 lakh, marginal relief
- Finance Act, 2026 (No. 4 of 2026, 30.03.2026), s. 3 — rates for tax year 2026-27 under the Income-tax Act, 2025; s. 3(4) Table Sl. No. 10 surcharge 10/15/25 %; s. 3(5) marginal relief; s. 3(15) Health and Education Cess 4 %
- Budget Speech 2026-27, para. 99: Income Tax Act, 2025 comes into effect from 1 April 2026
- EPF wage ceiling INR 25 000 from 17.09.2026 (S.O. 5109(E)); EPF 12 %, EPS 8.33 %, EDLI 0.5 %
- BDO India alert, 21.09.2026 — EPF wage ceiling revised to INR 25 000 (S.O. 5109(E), 17.09.2026)
- Lakshmikumaran & Sridharan — Professional Tax is not levied in the NCT of Delhi
Data checked: 2026-11-01. An indicative calculation for a typical case. Not tax advice.