Offer Letter Format (India) with Salary Structure: What to Include + Free Template

The offer letter is often the first formal document a new employee receives, and one of the first things an HR fresher is asked to draft. A clear offer letter sets expectations, prevents salary disputes and makes the company look professional.

This is general guidance, not legal advice. Employment terms depend on your company's policies, state rules and applicable labour laws, so have final templates reviewed by your HR head or legal adviser.

Offer letter vs appointment letter

• An offer letter confirms that the company wants to hire the candidate, and states the role, compensation and joining date. It's issued before joining.
• An appointment letter is issued on or after joining, and contains the detailed terms of employment: probation, notice period, leave, confidentiality and so on.

Many small companies combine the two. That's fine, as long as the essentials below are covered.

The 10 sections every offer letter needs

1. Company letterhead, date and reference number
2. Candidate's full name and address
3. Position / designation and the department they'll join
4. Reporting manager (name or role)
5. Work location and whether the role is onsite, hybrid or remote
6. Date of joining and the date by which the offer must be accepted
7. Compensation: annual CTC, with the salary structure attached as an annexure
8. Probation period and the key conditions of employment
9. Documents to bring on joining (ID, education and experience proofs, relieving letter)
10. Acceptance section for the candidate to sign and date

Presenting the salary structure clearly

The most common source of confusion is the gap between CTC, gross salary and take-home pay. A good annexure shows all three:

Component	Monthly (₹)	Annual (₹)
Basic	12,000	1,44,000
HRA	4,800	57,600
Special allowance	3,200	38,400
Gross salary	20,000	2,40,000
Employer PF contribution	1,440	17,280
Employer ESI contribution	650	7,800
Cost to company (CTC)	22,090	2,65,080

Then show the estimated deductions (employee PF, ESI, professional tax where applicable and TDS if any) to arrive at an indicative net pay. The figures above are illustrative. Use your company's actual structure and the current statutory rates.

5 mistakes HR freshers make

1. Quoting only CTC, so the candidate expects a higher take-home and feels misled on the first payslip.
2. Forgetting the acceptance deadline, which leaves offers open indefinitely.
3. Copy-paste errors in names, designations or dates. Always proofread against the approval note.
4. Missing the probation and notice terms, which later become disputes.
5. Sending without approval: every offer should match an approved requisition and salary band.

Get the template

Our free HR Starter Kit includes ready-to-edit offer letter and appointment letter formats, a payroll calculator with PF, ESI and TDS, and 20+ other HR templates.

In the Practical HR Management Course, Week 8 is dedicated to onboarding and documentation: you draft a full offer letter, appointment letter, onboarding plan and background-verification checklist, and faculty review them for your portfolio.