Understanding salaries in India can feel confusing, especially when you hear terms like LPA, CTC, gross salary, deductions, and in hand salary. Many job seekers and young professionals often receive an offer letter that looks impressive at first glance, but the actual money they get every month is much lower. To make things easy, here is a clear and friendly explanation of how an 8.4 LPA in hand salary works, how deductions affect your take home pay, and what you can do to increase your monthly income.
The focus keyword of this guide is 8.4 LPA in hand salary, and real life examples are used so that anyone can understand how salary breakup works in India.
What LPA, CTC and In Hand Salary Really Mean
Before checking the exact 8.4 LPA in hand salary per month, it is important to understand three basic salary terms.
1. What is LPA
LPA means Lakh Per Annum. It is simply your yearly salary package. If you hear 8.4 LPA, it means the company is offering 8 lakh 40 thousand rupees per year.
2. What is CTC
CTC means Cost to Company. It includes everything the company spends on you. This may include your basic pay, HRA, special allowance, PF contribution, health insurance, bonus, and sometimes benefits you do not receive as cash.
3. What is In Hand Salary
In hand salary means the amount you actually receive in your bank account every month after all deductions. This is your real take home pay.
A simple way to remember this is:
CTC is the total package
Gross salary is before deductions
In hand salary is after deductions
8.4 LPA In Hand Salary Per Month Breakdown
Let us break down a typical 8.4 LPA salary structure in a simple and easy format.
CTC: ₹8,40,000 per year
Monthly CTC: ₹70,000
A common salary structure for this package may look like this.
Approx Monthly Salary Structure
| Component | Amount (Monthly) |
|---|---|
| Basic Salary | ₹28,000 |
| HRA | ₹14,000 |
| Special Allowance | ₹17,000 |
| Employer PF Contribution | ₹3,360 |
| Other Benefits | ₹7,640 |
| Total Monthly CTC | ₹70,000 |
Monthly Deductions
| Deduction Type | Amount (Monthly) |
|---|---|
| Employee PF Contribution | ₹3,360 |
| Professional Tax | ₹200 |
| Income Tax plus Cess | ₹3,500 approx |
| Total Deductions | ₹7,060 approx |
Final In Hand Salary
₹70,000 minus ₹7,060 equals approx ₹62,940 per month
So, the 8.4 LPA in hand salary per month is close to ₹63,000, depending on the company structure, location, and tax regime you choose.
Why Your In Hand Salary is Lower Than Your CTC
Many job seekers think companies deduct too much money. The truth is that CTC includes several parts that are not paid directly.
Main Reasons for Lower In Hand Salary
• PF deduction
• Income tax
• Professional tax
• Insurance or food card benefits
• Employer PF which is counted inside CTC but not given as cash
Understanding these parts helps you become smarter during salary negotiations.
How PF Affects Your Take Home Salary
PF means Provident Fund. Both you and your employer contribute 12 percent of your basic salary.
• Your PF deduction reduces your monthly in hand
• But your PF grows with interest
• It becomes a large saving for your future
For an 8.4 LPA salary, PF per month is around ₹3360 from your side.
How Income Tax Impacts In Hand Salary
Your tax depends on the tax regime you choose. Most people fall in the taxable category at 8.4 LPA.
A simple understanding is:
• Taxable income is calculated after standard deduction
• HRA exemption can reduce tax if you live on rent
• New tax regime reduces complexity but gives fewer benefits
At 8.4 LPA, monthly tax comes around ₹3200 to ₹3800 depending on exemptions.
Real Examples of In Hand Salary for Different Salary Packages
To make things even more clear, here are simple monthly take home examples for different LPA slabs.
5 LPA Salary Example
| Item | Amount |
|---|---|
| Monthly CTC | ₹41,600 |
| Deductions | ₹4,800 approx |
| In Hand Salary | ₹36,500 approx |
10 LPA Salary Example
| Item | Amount |
|---|---|
| Monthly CTC | ₹83,333 |
| Deductions | ₹10,500 approx |
| In Hand Salary | ₹72,800 approx |
20 LPA Salary Example
| Item | Amount |
|---|---|
| Monthly CTC | ₹1,66,666 |
| Deductions | ₹28,000 approx |
| In Hand Salary | ₹1,38,500 approx |
These examples show that higher CTC does not always mean huge in hand salary because taxes increase with income.
How Bonuses and Incentives Affect Your Salary
Many companies offer bonuses like:
• Performance bonus
• Joining bonus
• Annual bonus
• Festive bonus
• Sales incentives
Important things to know:
• Most bonuses are taxable
• Many companies divide annual bonuses into monthly payouts
• Joining bonus is often one time with tax deduction
• You cannot calculate in hand salary correctly unless you know the bonus type
Tips to Increase Your In Hand Salary
Here are simple and practical ways to improve your take home pay without breaking any rules.
1. Ask for a Higher Basic Salary
A balanced structure helps you get better PF and better HRA.
2. Use Tax Saving Investments
Use simple tools like ELSS funds, PPF, NPS tier one, and term insurance.
3. Choose the Right Tax Regime
Compare old and new tax regimes before finalizing your choice every year.
4. Claim HRA Properly
If you live on rent, maintain rent receipts and landlord details.
5. Negotiate Fixed Salary Instead of Variable
Higher fixed pay gives more monthly stability.
6. Understand Your Company Benefits
Sometimes benefits like food cards reduce tax and increase savings.
Benefits of Understanding Your Salary Structure
When you clearly understand LPA in hand and how every component works, you get several advantages.
• Better salary negotiation
• Smart tax planning
• Higher savings
• More confidence during job changes
• No confusion after receiving salary slips
Knowledge gives you power and clarity.
Conclusion
Knowing your real 8.4 LPA in hand salary helps you understand exactly how much money you take home every month. Salary breakup is not complicated once you understand the meaning of PF, HRA, basic pay, professional tax, and income tax. A clear structure also helps you plan your expenses, savings, and investments better. Whether you are a fresher or an experienced professional, understanding your salary is one of the smartest financial decisions you can make.
Frequently Asked Questions
1. What is the 8.4 LPA in hand salary per month
It comes to around ₹62,000 to ₹63,000 depending on PF, tax regime, and company policy.
2. Is PF compulsory for all
Yes, if your basic salary is within PF limits. PF helps you build long term savings.
3. What is the difference between gross salary and in hand salary
Gross salary is before deductions. In hand salary is the final amount you receive after PF, tax, and other deductions.
4. How can I increase my take home salary
Choose tax saving options, claim HRA, select the right tax regime, and negotiate for better fixed pay.
5. Why does CTC look higher than the salary I get
CTC includes many non cash benefits like PF, insurance, and employer contributions that reduce the final in hand amount.
Read more
7.2 LPA In Hand Salary Details: Monthly, Yearly and Deductions Guide
