Here is the short answer first: a 4 LPA CTC works out to roughly ₹28,332 a month in hand. 4 LPA means a cost to company of ₹4,00,000 a year, or ₹33,333 a month. The difference is not a hidden charge; it is mostly money set aside for your own future (PF and gratuity) plus statutory deductions, and I've broken each one down below.
The numbers use the structure most employers have moved to since the new Labour Codes took effect on 21 November 2025: basic pay at 50% of CTC, employer and employee PF at 12% of basic each, gratuity provision at 4.81% of basic, professional tax of ₹200 a month and the new tax regime for FY 2026-27, whose slabs Budget 2026 left unchanged.
Full payslip breakdown of a 4 LPA CTC
Read this table from top to bottom. The first block is money your employer spends on you but keeps out of your salary; what remains is the gross pay printed on your payslip. The second block is what gets deducted from that gross before the ₹28,332 reaches your account.
| Component | Yearly | Monthly |
|---|---|---|
| CTC (4 LPA) | ₹4,00,000 | ₹33,333 |
| Employer PF (12% of basic) | ₹24,000 | ₹2,000 |
| Gratuity provision (4.81% of basic) | ₹9,620 | ₹802 |
| Gross salary | ₹3,66,380 | ₹30,532 |
| of which Basic (50% of CTC) | ₹2,00,000 | ₹16,667 |
| of which HRA (40% of basic) | ₹80,000 | ₹6,667 |
| of which Special allowance | ₹86,380 | ₹7,198 |
| Employee PF (12% of basic) | ₹24,000 | ₹2,000 |
| Professional tax | ₹2,400 | ₹200 |
| Income tax (new regime, incl. cess) | ₹0 | ₹0 |
| In-hand salary | ₹3,39,980 | ₹28,332 |
Two lines deserve a second look. The ₹33,620 a year of employer PF and gratuity is part of your CTC but never shows up on a monthly payslip. And the ₹24,000 of employee PF is not lost: together with the employer's share, ₹48,000 a year goes into your EPF account, which currently earns 8.25% (the rate EPFO declared for FY 2025-26).
4 lakh per annum in monthly terms
LPA stands for lakh per annum, so 4 LPA is ₹4 lakh a year. Divided by 12, that is ₹33,333 a month of CTC, but only ₹28,332 a month actually lands in your account.
| Per year | Per month | Per day (365) | |
|---|---|---|---|
| CTC | ₹4,00,000 | ₹33,333 | ₹1,096 |
| Gross salary | ₹3,66,380 | ₹30,532 | ₹1,004 |
| In-hand salary | ₹3,39,980 | ₹28,332 | ₹931 |
Measured against working time, the in-hand pay is about ₹1,288 per working day (22 working days a month) or ₹161 an hour for an 8-hour day. That hourly figure is useful when you're weighing overtime, a side project or a freelance rate against your job.
Income tax on 4 LPA: zero, and here is why
Under the new regime the only deduction a salaried person gets is the ₹75,000 standard deduction. Gross salary of ₹3,66,380 minus ₹75,000 gives a taxable income of ₹2,91,380. Employer PF and gratuity are not taxed, and professional tax is not deductible in the new regime.
| Taxable income slab | Rate | Income in slab | Tax |
|---|---|---|---|
| ₹0 – ₹4,00,000 | 0% | ₹2,91,380 | ₹0 |
| Tax on slabs | ₹0 | ||
| Add: 4% health & education cess | ₹0 | ||
| Income tax payable | ₹0 |
Your taxable income of ₹2,91,380 is under ₹4 lakh, the point where the first tax slab starts, so there is no slab tax at all and the rebate is not even needed.
PF on full basic vs the ₹15,000 wage ceiling
PF is compulsory only on basic pay up to ₹15,000 a month, which means a maximum of ₹1,800 a month from each side. Many companies still deduct 12% of the full basic, which is what the main table assumes, but plenty of employers cap it. Your basic here is ₹16,667 a month, so the cap makes a real difference:
| 12% of full basic | Capped at ₹15,000 | |
|---|---|---|
| Employee PF / month | ₹2,000 | ₹1,800 |
| Income tax / year | ₹0 | ₹0 |
| In-hand / month | ₹28,332 | ₹28,732 |
| Total EPF saving / year | ₹48,000 | ₹43,200 |
With the cap, your take-home rises by about ₹400 a month, but you put ₹4,800 a year less into EPF. If you take the cap, consider moving at least part of that extra cash into a SIP or PPF so your long-term saving doesn't quietly shrink.
Is ITR filing mandatory at this income?
Not compulsorily. Your salary income after the standard deduction is about ₹2,91,380, below the ₹4 lakh basic exemption limit, so the law does not require you to file. I would still file a nil return each year. It costs nothing on the income tax portal, it is the only way to get back any TDS deducted by mistake, and banks treat a few years of ITRs as proof of income when you apply for a loan or credit card.
How to split ₹28,332 a month
If this is your first salary, a rough plan helps more than a perfect one. The 50-30-20 rule splits ₹28,332 into essentials, lifestyle and savings. Adjust the shares to your city: rent in Mumbai or Bengaluru will push 'needs' well above half.
| Bucket | Share | Per month |
|---|---|---|
| Needs (rent, groceries, bills, EMIs) | 50% | ₹14,166 |
| Wants (eating out, travel, shopping) | 30% | ₹8,500 |
| Savings and investments | 20% | ₹5,666 |
Keep in mind that you are already saving ₹4,000 a month through EPF before this budget even starts. Build an emergency fund of three to six months of expenses, about ₹84,995 to ₹1,69,990, before you lock money into long-term investments.
Is 4 LPA a good package?
4 LPA is a solid salary for a fresher or someone with a couple of years of experience. Engineering graduates from tier-2 and tier-3 colleges, analysts, and many mid-size company roles start around this range. A take-home of ₹28,332 covers a comfortable single life in most cities, and the new regime keeps your tax at zero.
How nearby salaries compare
Use this to see how your take-home moves as the CTC changes. Each row links to its own full breakdown.
| Package | CTC | In-hand / month | Tax / year |
|---|---|---|---|
| 3 LPA in-hand salary | ₹3,00,000 | ₹21,199 | ₹0 |
| 3.5 LPA in-hand salary | ₹3,50,000 | ₹24,765 | ₹0 |
| 3.6 LPA in-hand salary | ₹3,60,000 | ₹25,479 | ₹0 |
| 4 LPA (this page) | ₹4,00,000 | ₹28,332 | ₹0 |
| 4.5 LPA in-hand salary | ₹4,50,000 | ₹31,898 | ₹0 |
| 5 LPA in-hand salary | ₹5,00,000 | ₹35,465 | ₹0 |
| 5.5 LPA in-hand salary | ₹5,50,000 | ₹39,031 | ₹0 |
The formula, with your numbers
Employer PF = 12% × basic = ₹24,000; Gratuity = 4.81% × basic = ₹9,620
Gross = CTC − employer PF − gratuity = ₹3,66,380
Taxable (new regime) = gross − ₹75,000 = ₹2,91,380 → tax ₹0
In-hand = gross − employee PF ₹24,000 − PT ₹2,400 − tax ₹0 = ₹3,39,980
What this calculation assumes:
- Basic pay at 50% of CTC, HRA at 40% of basic, the remainder as special allowance.
- Employer PF and gratuity are part of CTC; no insurance premium, meal card or variable pay is assumed.
- Professional tax is taken as ₹200 a month (₹2,400 a year). It varies by state: Delhi, Haryana and Uttar Pradesh do not levy it, and Karnataka exempts gross pay up to ₹25,000 a month.
- Tax uses FY 2026-27 new-regime slabs, the ₹75,000 standard deduction, the Section 87A rebate up to ₹12 lakh with marginal relief, surcharge where relevant and 4% cess.
If your company uses a different basic percentage or caps PF, put your own numbers into the CTC to in-hand calculator, or use the quick calculator on this page.
4 LPA in-hand salary: FAQs
What is the in-hand salary for 4 LPA per month?
On a standard structure, a 4 LPA CTC gives an in-hand salary of about ₹28,332 per month in FY 2026-27 under the new tax regime, or ₹3,39,980 a year.
How much PF is deducted on 4 LPA?
If PF is calculated at 12% of a basic pay of ₹16,667 a month, your own PF deduction is ₹2,000 a month and your employer adds the same amount. If your employer caps PF at the ₹15,000 wage ceiling, the deduction is ₹1,800 a month instead.
Is there any income tax on 4 LPA?
No. Taxable income works out to ₹2,91,380, which is within the ₹12 lakh limit for the Section 87A rebate under the new regime, so the tax payable is zero.
4 LPA means how much salary per month?
4 LPA means ₹4,00,000 per year, which is ₹33,333 per month of CTC. After deductions, the monthly in-hand is about ₹28,332.
Why is my in-hand lower than CTC divided by 12?
Because ₹5,002 a month goes to employer PF, gratuity, your own PF and professional tax. Most of it is saved for you in EPF and gratuity, not lost.