Income Tax Calculator — Old Regime vs New Regime
This calculator computes your income tax for FY 2024-25, FY 2025-26 and FY 2026-27 under both regimes at once and tells you which one leaves more money in your pocket. Enter gross salary, other income, HRA exemption, home-loan interest and Chapter VI-A deductions; the tool applies the correct standard deduction (₹50,000 old / ₹75,000 new), slab rates, rebate u/s 87A with marginal relief, surcharge with marginal relief and 4% Health & Education Cess.
New regime slabs (FY 2025-26 & FY 2026-27)
- Up to ₹4,00,000 — Nil
- ₹4,00,001 – ₹8,00,000 — 5%
- ₹8,00,001 – ₹12,00,000 — 10%
- ₹12,00,001 – ₹16,00,000 — 15%
- ₹16,00,001 – ₹20,00,000 — 20%
- ₹20,00,001 – ₹24,00,000 — 25%
- Above ₹24,00,000 — 30%
Rebate u/s 87A makes tax nil when taxable income is up to ₹12,00,000 (₹12,75,000 of salary after the standard deduction). The old regime keeps the ₹2.5 lakh / 5% / 20% / 30% structure with rebate up to ₹5 lakh, but allows HRA, LTA, 80C, 80D, 80CCD(1B), home-loan interest and other deductions.
Worked example
Salary ₹15,00,000 (no other income); HRA exempt ₹1,20,000; professional tax ₹2,400; 80C ₹1,50,000; NPS 80CCD(1B) ₹50,000; 80D ₹25,000; home-loan interest ₹1,50,000. Old regime: taxable income = 15,00,000 − 1,20,000 − 50,000 − 2,400 − 1,50,000 − 2,25,000 = ₹9,52,600 → tax ₹1,03,020 + cess = ₹1,07,141. New regime: taxable income = 15,00,000 − 75,000 = ₹14,25,000 → tax ₹93,750 + cess = ₹97,500. The new regime saves about ₹9,600 even with ₹5.5 lakh of deductions — a typical break-even today sits around ₹8 lakh of total deductions for a ₹15 lakh salary.
Who should use this
- Salaried employees choosing the regime to declare to their employer in April.
- Accountants preparing Form 16 or TDS projections.
- Freelancers and pensioners estimating advance tax.
The new regime is the default from FY 2023-24; salaried taxpayers can switch every year while filing, but those with business income can opt out only once. Special-rate income such as capital gains is excluded here — use the Capital Gains Calculator for that.
Frequently Asked Questions
Which regime is better for a ₹12 lakh salary?
Under the new regime for FY 2025-26 onwards, salary up to ₹12.75 lakh is tax-free after the ₹75,000 standard deduction and the ₹60,000 rebate u/s 87A. The old regime would need more than ₹5 lakh of deductions to match, so the new regime almost always wins at this level.
Is the standard deduction available in the new regime?
Yes. From FY 2024-25 the standard deduction for salaried and pensioners is ₹75,000 in the new regime and ₹50,000 in the old regime. Family pensioners get ₹25,000 (new) / ₹15,000 (old).
Can I switch between old and new regime every year?
Salaried individuals without business income can choose either regime each year at the time of filing the return (Form 10-IEA is needed only to opt for the old regime if you have business income). Taxpayers with business income can opt out of the new regime only once in a lifetime.
What is marginal relief on the 87A rebate?
If your taxable income slightly exceeds ₹12 lakh (new regime), the tax payable is limited to the amount by which income exceeds ₹12 lakh. For example on ₹12,10,000 the slab tax is ₹61,500 but you pay only ₹10,000 plus cess.
Does this calculator include surcharge?
Yes. Surcharge of 10%, 15%, 25% and 37% applies above ₹50 lakh, ₹1 crore, ₹2 crore and ₹5 crore respectively (capped at 25% in the new regime), with marginal relief computed automatically.
Disclaimer: This tool is for general information and estimation only. Tax rates and rules change — verify with official sources or a professional before acting. Read full disclaimer.