Average hike 2027
9.1%
Aon, after 9.0% in 2026
Companies above 9%
62%
of those surveyed by Aon
Real wage growth
5.1%
Aon's 2027 estimate
Attrition 2026
18.0%
up from 16.2%
Survey figures from Aon's Salary Increase and Turnover Survey 2026-27 (released 14 October 2026). In-hand figures on this page are PayMetric Labs' own modelled estimates on FY 2026-27 New Regime rules.
Work out your own hike in hand
New and Old Regime side by side, with marginal relief and your deductions.
How much of a 2027 salary hike reaches your in-hand pay
Hikes are announced on CTC, but CTC isn't what you're paid. On a typical structure (basic at 40% of CTC) about 7% of CTC is employer PF and gratuity, which you only see later. From the gross salary that's left, your own 12% PF, professional tax and income tax come out. Each of those grows with a hike, so your in-hand pay rises by less than the headline.
Below the zero-tax line the effect is modest and even: you keep about 88 paise of every rupee of CTC increase, and your in-hand pay rises by the same 9.1% as your CTC. The picture changes once tax applies, and most sharply when a hike carries you across the line.
| CTC now | In-hand a month now | After a 9.1% hike | In-hand rise a year | You keep |
|---|---|---|---|---|
| ₹6 lakh | ₹44,038 | ₹48,064 | +₹48,308 (9.1%) | 88% |
| ₹10 lakh | ₹73,530 | ₹80,239 | +₹80,513 (9.1%) | 88% |
| ₹12 lakh | ₹88,276 | ₹96,327 | +₹96,616 (9.1%) | 88% |
| ₹13 lakh | ₹95,649 | ₹1,00,425 | +₹57,312 (5.0%) | 48% |
| ₹15 lakh | ₹1,03,612 | ₹1,12,021 | +₹1,00,908 (8.1%) | 74% |
| ₹20 lakh | ₹1,33,599 | ₹1,44,076 | +₹1,25,716 (7.8%) | 69% |
| ₹30 lakh | ₹1,86,647 | ₹2,00,155 | +₹1,62,091 (7.2%) | 59% |
| ₹40 lakh | ₹2,36,125 | ₹2,54,135 | +₹2,16,121 (7.6%) | 59% |
PayMetric Labs' own modelled estimate: basic 40% of CTC, PF at 12% of full basic (employer and employee), gratuity accrual at 4.81% of basic, ₹200 a month professional tax, New Regime FY 2026-27 slabs with the ₹75,000 standard deduction, 87A rebate and 4% cess. Your company's structure will differ; the CTC calculator takes your own split.
The ₹12.75 lakh line: when a hike starts income tax
Under the New Regime a salaried employee owes no income tax until gross salary passes ₹12.75 lakh: the ₹75,000 standard deduction brings it down to ₹12 lakh of taxable income, and the Section 87A rebate cancels the tax on that. On the structure above, that's a CTC of about ₹13.69 lakh.
Take someone on ₹13 lakh CTC. Before the hike they pay no tax. A 9.1% hike lifts their CTC to ₹14.18 lakh and their gross over the line, so tax of about ₹47,355 a year begins. Their in-hand pay rises by ₹57,312, just 48% of the CTC increase. Marginal relief stops it being worse: tax can't exceed the income above the line, so a hike never leaves you with less in hand than before. Our Section 87A guide explains the mechanics.
Further up, the effect settles. On ₹20 lakh CTC you keep 69% of the increase, because each extra rupee meets your top slab rate. These are FY 2026-27 rules: if the 1 February 2027 Budget changes slabs or the rebate for FY 2027-28, when most April hikes land, the numbers change, and we'll update this page.
Salary hike 2027 by sector
| Sector | 2027 projected | 2026 | Attrition 2026 |
|---|---|---|---|
| NBFCs | 10.1% | n/a | 37.0% |
| Energy | 9.9% | n/a | n/a |
| Real estate and infrastructure | 9.8% | 10.3% | 21.7% |
| Funds and asset management | 9.6% | n/a | n/a |
| Life sciences | 9.6% | n/a | n/a |
| Automotive and vehicle manufacturing | 9.5% | 9.7% | n/a |
| Global capability centres (GCCs) | 9.4% | 9.3% | n/a |
| Banking | 8.5% | 8.6% | 22.0% |
| Chemicals | 8.0% | 8.1% | n/a |
| Technology consulting and services | 6.6% | 6.6% | 18.4% |
Aon Salary Increase and Turnover Survey 2026-27, as reported on 14 October 2026. “n/a” where Aon's published summary gives no figure.
The spread is wider than the average suggests. Financial services and energy are paying up for scarce people, and attrition explains part of it: NBFCs lose more than a third of their staff a year. Technology consulting and services firms, the biggest employers of engineers, are holding at 6.6% for a second year, while GCCs plan 9.4%. That gap is one reason engineers move from services firms to GCCs and product companies; our product vs services salary guide and GCC CTC vs take-home guide compare the packages.
Payscale's global salary budget survey has India a little lower, at 8.8% for 2027 after 9.5% in 2026. Different samples give different averages, so treat 9% as the centre of the range rather than a precise figure.
Labour codes: why your CTC split may change with this hike
The Code on Wages defines “wages” to exclude most allowances, but if those excluded parts add up to more than half of your total pay, the excess is counted back as wages. Wages drive PF and gratuity, so a CTC built on a low basic and large allowances may be restructured. Aon found 65.4% of employers already compliant and 42.8% expecting payroll costs to rise by at least 1%.
For you, a higher wage base means more PF and gratuity: more retirement savings, less monthly in-hand on the same CTC. If your 2027 hike letter shows a bigger basic, that's probably why. Our PF and gratuity guide shows the effect, and the statutory bonus guide covers the Code's bonus rules.
How to negotiate a better hike in your 2027 appraisal
- Know your market rate. Check your role on our India salary pages or run the Am I underpaid checker. Being below market for your level is a stronger case than the average hike.
- Talk before ratings close. Hike budgets are split across teams early in the appraisal cycle. Raise it with your manager before ratings are finalised, not after the letter.
- Price your skills. Aon reports premiums of about 10% for AI, machine learning and data science roles. If your work has shifted that way, ask for the role to be re-levelled, not just a higher percentage.
- Compare an outside offer on in-hand, not CTC. Put both packages through the take-home calculator; variable pay, joining bonuses and PF structure can make a bigger CTC worth less.
- Mind the tax line. Near ₹12.75 lakh gross, ask whether part of the hike can go to employer NPS, which stays deductible in the New Regime.
Salary hike 2027: frequently asked questions
What is the average salary hike in India for 2027?
About 9.1%. Aon's Salary Increase and Turnover Survey 2026-27, covering more than 1,200 companies across 45 industries, projects an average of 9.1% for 2027 against 9.0% actually given in 2026, and 62% of companies are budgeting more than 9%. Payscale's survey of global employers is a little lower for India at 8.8%. Both are budgets, not promises: your own hike depends on your rating, role and company.
Is a 10% hike good in 2027?
Yes, it's above the 9.1% average and well above inflation. Aon estimates real wage growth, the hike minus inflation, at 5.1% for 2027. In some sectors 10% is exceptional: technology consulting and services firms plan just 6.6%. Judge it against your own market rate too, since a good hike on a below-market salary can still leave you underpaid.
Why is my in-hand increase smaller than my hike percentage?
Because hikes are given on CTC, and parts of CTC never reach your account. Employer PF and gratuity grow with your basic, your own 12% PF contribution rises too, and once your gross salary passes ₹12.75 lakh income tax starts. Below that line, PayMetric Labs' own modelled estimate is that you keep about 88% of the CTC increase in hand; just above it, as little as 48%.
When are salary hikes given in India?
Most companies with an April to March financial year run appraisals between April and June, with the new salary effective from 1 April, and hike letters often arriving in May or June with arrears. Companies on a calendar-year cycle, including many multinationals and GCCs, give hikes from January. Ask HR which cycle you're on so you raise your case before ratings are finalised.
Will my 2027 hike push me into paying income tax?
It can. Under the New Regime a salaried employee pays no income tax on gross salary up to ₹12.75 lakh: the ₹75,000 standard deduction plus the Section 87A rebate up to ₹12 lakh of taxable income. On a typical structure that is a CTC of about ₹13.69 lakh. A hike that crosses it starts tax, but marginal relief means the tax can't exceed the income above the line. These are FY 2026-27 rules; the 1 February 2027 Budget sets FY 2027-28.
What hike can IT services employees expect in 2027?
Less than average. Aon projects 6.6% for technology consulting and services firms in 2027, the same as in 2026 and the lowest of the sectors it reports, with attrition there at 18.4%. GCCs are projected at 9.4%. Skills matter more than sector: Aon reports premiums of about 10% for AI, machine learning and data science roles over broader engineering.
My hike takes me just over the zero-tax line. What can I do?
Ask whether part of the increase can go into your employer's NPS contribution. Under the New Regime, employer contributions to NPS of up to 14% of basic plus dearness allowance are deductible (Section 124 of the Income-tax Act, 2025, formerly 80CCD(2)), so they cut taxable income without reducing your total pay. You can't move money into allowances like HRA to save tax in the New Regime, because those exemptions don't apply there.
Related: New vs Old Regime · CTC to in-hand calculator · Bengaluru vs Hyderabad vs Pune tech salaries
Sources and method
Hike projections, sector figures, attrition and labour code readiness: Aon's Salary Increase and Turnover Survey 2026-27, more than 1,200 organisations across 45 industries, as reported on 14 October 2026. Second view: Payscale Salary Budget Survey, August 2026.
In-hand figures are PayMetric Labs' own modelled estimates from our India CTC and income tax engines on FY 2026-27 New Regime rules, using the typical structure described under the table. They leave out variable pay, perquisites, the Old Regime and surcharge. This is general information, not personal tax or financial advice.