Employee Cost Calculator
Work out what an employee really costs a year — CTC plus employer PF, ESI, gratuity provision, insurance, equipment, workspace, software and amortised recruitment. The total typically runs 20–35% above the offer letter.
Free · No sign-up · Nothing leaves your browser · Figures reviewed 22 September 2026
Your details
Drives the PF and gratuity lines. Defaults to 40% of CTC if left blank.
Employer's annual share per employee.
A ₹75,000 laptop on a three-year cycle is ₹25,000 a year.
Rent, utilities and facilities per seat. Zero for fully remote.
Per seat, per year.
Agency fees, referral bonus, job ads, interview time.
Years. Recruitment cost is spread over this.
True annual cost of this employee
₹14,10,144
₹2,10,144 more than the ₹12,00,000 CTC — 17.5% on top.
- CTC · 85%
- Statutory · 3%
- Overheads · 12%
Statutory, on top of CTC
- Employer PF12% of ₹15,000 a month
- ₹21,600
- EDLI and admin charges
- ₹1,800
- Employer ESINot covered — gross is above ₹21,000
- ₹0
- Gratuity provision15/26 of a month's wages accrued each year
- ₹23,077
- Statutory total
- ₹46,477
Where CTC already includes the employer's PF — as most Indian offer letters do — set these against it rather than adding twice.
What CTC never shows
- Health insurance premium
- ₹12,000
- EquipmentAnnualised
- ₹25,000
- Workspace₹6,000 a month
- ₹72,000
- Software and licences
- ₹18,000
- Training
- ₹10,000
- Recruitment₹80,000 spread over 3 years of expected tenure
- ₹26,667
- Overhead total
- ₹1,63,667
Per unit
- Per month
- ₹1,17,512
- Per working dayAbout 250 working days a year after leave and holidays
- ₹5,641
- Per hourAbout 2,000 productive hours a year
- ₹705
Recruitment is amortised over expected tenure, which is why shortening tenure raises the annual cost of the same salary — it is the single biggest lever on this number.
CTC is a salary figure dressed up as a cost figure. It leaves out most of what an employer actually spends: statutory contributions that sit outside it, the gratuity liability accruing quietly each year, and every overhead from a laptop to a seat to a software licence.
This calculator adds them up and then divides by the units people actually plan with — per month, per working day, per hour. The recruitment line is amortised over expected tenure, which is what makes retention show up as a cost lever rather than a sentiment.
What sits outside CTC
Employer provident fund, EDLI and administration charges, employer ESI where the employee is covered, and the gratuity provision — fifteen twenty-sixths of a month's wages accruing every year, whether or not anyone books it.
Many Indian offer letters fold the employer's PF into CTC. Where yours does, treat the statutory block as already counted rather than adding it twice; the overheads block is the part that is genuinely additional in almost every case.
Why tenure changes the number
Recruitment is a one-off cost spread across however long someone stays. Hire for ₹80,000 and keep them six years and it is ₹13,300 a year. Keep them eighteen months and it is ₹53,000 a year — for the same person at the same salary.
That is the arithmetic behind retention being cheaper than hiring, and it is the reason a cost-per-employee number computed without tenure tells you very little.
Frequently asked questions
- How much more than CTC does an employee cost?
- Typically 20% to 35% more once employer statutory contributions, the gratuity provision, insurance, equipment, workspace, software and amortised recruitment are counted. The spread depends mostly on whether the role needs a seat and how long people stay.
- Is employer PF included in CTC?
- Usually yes in India — most offer letters show it inside CTC. Employer ESI, the gratuity provision and every overhead are normally outside it.
- What is the gratuity provision per year?
- Fifteen twenty-sixths of a month's wages for each year of service — about 4.81% of annual wages. It accrues from day one even though it only vests at five years for permanent employees.
About this tool
Built by the ViniOffice team. Figures and rules last reviewed 22 September 2026 against the statutory reference this team maintains. Indian statutory rates are date-effective and change by notification — confirm against the current one before running payroll or filing.
Next, you might need
- Calculator
Cost Per Hire Calculator
Total external and internal recruiting cost divided by hires actually made — including interviewer time, which is the line most often left out and frequently the largest on a competitive role.
Open - Calculator
Employee Turnover Cost Calculator
Cost out turnover per exit — recruitment, exit handling, the vacancy gap and ramp-up — and see what one percentage point of attrition is worth, which is the budget a retention programme has to beat.
Open - Calculator
Payroll Budget Planner
Build a year's payroll budget from headcount, increments, hires and attrition — with the part-year effect handled, and next year's exit run rate shown alongside this year's cost.
Open - Calculator
Contractor vs Employee Cost Calculator
Compare the full cost of an employee — CTC plus employer PF, ESI, gratuity and benefits — against a contractor's fees and GST, and read the misclassification risk that the arithmetic does not settle.
Open
Set up your digital office
Join the early-access list for ViniOffice and be among the first teams in at launch.