Net Salary Calculator – Calculate Your Take-Home Pay

Your gross salary is the total salary before taxes and deductions, while your net salary (also called take-home pay) is the actual amount you receive after all deductions. Our Net Salary Calculator helps you quickly estimate your monthly or yearly net salary by considering taxes, social security contributions, and other deductions.

Formula to Calculate Total Deductions

The total deductions can be calculated as:

$\text{Total Deductions}=\left(\text{Gross Salary}\times \frac{\text{Income Tax \%}}{100}\right)+\left(\text{Gross Salary}\times \frac{\text{Social Security \%}}{100}\right)+\text{Other Deductions}$​​​​​​​

Formula to Calculate Net Salary (Take-Home Pay)

$\text{Net Salary}=\text{Gross Salary}-\text{Total Deductions}$

Example Calculation

Example:

• Gross Salary = $6,000
• Income Tax = 12%
• Social Security = 5%
• Other Deductions = $300

Step 1: Calculate Total Deductions

$\text{Total Deductions}=(6000\times \frac{12}{100})+(6000\times \frac{5}{100})+300$

$\text{Total Deductions}=720+300+300=1320$

Step 2: Calculate Net Salary

$\text{Net Salary}=6000-1320=4680$

Final Result:

• Total Deductions: $1,320
• Net Salary (Take-Home Pay): $4,680

FAQs on Net Salary

1. What is the difference between gross salary and net salary?

Gross salary is the total amount an employee earns before deductions like taxes, social security, or provident fund contributions. Net salary, also known as take-home pay, is the amount you actually receive in your bank account after all deductions.

2. How is net salary calculated?

Net salary is calculated by subtracting all applicable deductions (income tax, social security, provident fund, and other deductions) from your gross salary.

$\text{Net Salary}=\text{Gross Salary}-\text{Total Deductions}$

3. Why is my net salary lower than my gross salary?

​​​​​​​Your net salary is lower than your gross salary because certain mandatory and optional deductions are subtracted, such as taxes, retirement contributions, insurance premiums, and other benefits.