Gross To Net (GTN) | Meaning and Definition

What is Gross-To-Net?

The GTN full form is Gross-To-Net. The Gross-To-Net is nothing but the process of calculating the net pay/take-home salary from the gross pay of an employee by subtracting deductions and reductions of other components such as the PF and others from it. The Gross-To-Net elements are the indications of the deductions and reductions that are to be taken.

The gross salary is the total amount which also includes benefits such as medical allowance, conveyance allowance, and others but is not the take-home salary of an employee received by him. When the deductions such as professional tax, pension, income tax, and others are made from the gross salary, it results in the net salary that the employee actually takes home in his pocket hence marking it as the take-home salary.

Net salary = Gross Salary – Deductions (professional and income taxes, pension, etc.)