India Income Tax Calculator

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Part of:India Personal Finance Guide 2026: EMI, SIP, FD, GST, Income Tax & Investment Calculators

India Income Tax Calculator: New vs Old Regime

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Compare India's new vs old income tax regime for FY 2025-26. Enter your salary and deductions to see which regime saves you more, with full surcharge and cess breakdown.

Gross Annual Salary (₹)

Old Regime Deductions (Not Used in New Regime)

Section 80C (₹, max 1,50,000)

HRA Exemption (₹)

Use the HRA calculator to compute this exactly

Section 80D — Health Insurance (₹, max 75,000)

NPS 80CCD(1B) (₹, max 50,000)

Home Loan Interest — Sec 24(b) (₹, max 2,00,000)

Enter values above to see results.

India Income Tax at a Glance

New vs Old Regime — FY 2025-26 (AY 2026-27)

₹12.75L

Effectively Tax-Free Salary (New Regime)

₹75K

Standard Deduction (New Regime)

₹1.5L

Section 80C Limit (Old Regime Only)

4%

Health & Education Cess (Both Regimes)

New Regime vs Old Regime: What's the Difference?

India's income tax system offers two regimes for FY 2025-26 (AY 2026-27): the new regime (default since FY 2023-24), which uses lower slab rates but disallows most deductions, and the old regime, which uses higher slab rates but allows deductions like Section 80C, HRA exemption, home loan interest, and NPS contributions.

Under Budget 2025, the new regime's Section 87A rebate zeroes out tax for taxable income up to ₹12 lakh, and with the ₹75,000 standard deduction for salaried employees, salaries up to ₹12.75 lakh pay no tax at all. The old regime only wins once your total deductions clear a break-even threshold that rises with income — this calculator computes both scenarios side by side so you don't have to guess.

Tax Slabs FY 2025-26

New Regime

₹0 – ₹3L: Nil
₹3L – ₹7L: 5%
₹7L – ₹10L: 10%
₹10L – ₹12L: 15%
₹12L – ₹15L: 20%
Above ₹15L: 30%

Old Regime

₹0 – ₹2.5L: Nil
₹2.5L – ₹5L: 5%
₹5L – ₹10L: 20%
Above ₹10L: 30%

Old-Regime-Only Deductions This Calculator Applies

Deduction	Limit
Section 80C (PPF, ELSS, EPF, life insurance)	₹1,50,000
HRA exemption	As entered — use the HRA calculator to compute yours
Section 80D (health insurance)	Up to ₹75,000 (self + senior citizen parents)
Section 80CCD(1B) — NPS	₹50,000, exclusive of 80C limit
Section 24(b) — home loan interest	₹2,00,000 for self-occupied property

History of the New Tax Regime

2020

Section 115BAC Introduced (Optional)

Budget 2020 introduced the new regime as an optional alternative with lower slab rates but no deductions. Uptake was modest — giving up HRA, 80C, and home loan interest deductions outweighed the lower rates for most deduction-heavy taxpayers at the time.

2023

New Regime Becomes Default

Budget 2023 made the new regime the default — taxpayers now must actively opt into the old regime — and extended the Section 87A rebate to taxable income up to ₹7 lakh.

2025

Rebate Raised to ₹12 Lakh

Budget 2025 raised the standard deduction to ₹75,000 for salaried taxpayers and the 87A rebate threshold to ₹12 lakh, taking effectively tax-free salary to ₹12.75 lakh — the version this calculator applies for FY 2025-26.

Tax Regime Myths vs. Facts

Myth

Everyone should just take the new regime since it’s the default.

Fact

The new regime wins for most taxpayers without major deductions, but a taxpayer with a home loan, metro HRA, and full 80C can still save more under the old regime — the break-even point varies by income, so always compare both.

Myth

A ₹15 lakh salary means my whole income is taxed at 30%.

Fact

India uses a slab system — only the portion of income within each bracket is taxed at that bracket’s rate. A ₹15 lakh earner pays 0% on the first ₹3L, 5% on the next ₹4L, and so on, not 30% on the entire amount.

Myth

Once I pick a regime, I’m locked in for life.

Fact

Salaried employees with no business income can switch regimes every single financial year with no restriction. Only taxpayers with business or professional income face a one-time switch limitation after filing Form 10-IEA.

Myth

Employer NPS contributions only help under the old regime.

Fact

Section 80CCD(2) — the employer’s NPS contribution — is deductible in BOTH the new and old regime, unlike almost every other Chapter VI-A deduction.

Frequently Asked Questions

Which tax regime should I choose, new or old?▼

If your total deductions (80C + HRA + 80D + NPS + home loan interest) are below roughly ₹4–4.5 lakh, the new regime almost always wins. Above that, run both scenarios through this calculator to see your exact numbers, since the break-even point varies by income level.

Is income up to ₹12 lakh really tax-free under the new regime?▼

Up to ₹12.75 lakh for salaried employees and pensioners — ₹12 lakh via the Section 87A rebate plus the ₹75,000 standard deduction. Above that threshold, tax is calculated slab by slab with no cliff-edge jump.

Can I switch tax regimes every year?▼

Salaried individuals with no business income can switch each financial year with no restriction. Taxpayers with business or professional income face a one-time switch restriction after opting for the old regime via Form 10-IEA.

Does this calculator include surcharge and cess?▼

Yes — a simplified surcharge is applied above ₹50 lakh, ₹1 crore, and ₹2 crore (capped at 25% under the new regime, up to 37% under the old regime), plus the standard 4% health and education cess in both regimes.

What deductions are not allowed under the new tax regime?▼

Section 80C (PPF, ELSS, life insurance), HRA exemption, Section 24(b) home loan interest for self-occupied property, and most Chapter VI-A deductions are unavailable under the new regime. The standard deduction and employer NPS contribution under 80CCD(2) remain available in both regimes.

Does the new regime offer a higher exemption for senior citizens?▼

No. The old regime gives a ₹3 lakh basic exemption for senior citizens (60+) and ₹5 lakh for super senior citizens (80+); the new regime applies the same slab structure regardless of age.

What income tax slabs apply for FY 2025-26?▼

New regime: 0% up to ₹3L, 5% (₹3–7L), 10% (₹7–10L), 15% (₹10–12L), 20% (₹12–15L), 30% above ₹15L. Old regime: 0% up to ₹2.5L, 5% (₹2.5–5L), 20% (₹5–10L), 30% above ₹10L.

How much home loan interest can I deduct under the old regime?▼

Up to ₹2 lakh per year under Section 24(b) for a self-occupied property, regardless of how much interest you actually paid above that cap. This deduction is not available under the new regime.

Can I claim HRA and 80C together with the new regime?▼

No — HRA exemption, Section 80C, and most other deductions this calculator lets you enter are exclusively old-regime benefits. If you choose the new regime, none of these deductions apply, and your tax is based purely on gross salary minus the ₹75,000 standard deduction.

Research & Data Sources

Income Tax Department — Slabs & Rebate Rules

Official FY 2025-26 slab structure, Section 87A rebate thresholds, and standard deduction amounts for both regimes.

↗ incometax.gov.in

Union Budget 2025, Ministry of Finance

The source of the ₹75,000 standard deduction and ₹12 lakh rebate threshold this calculator applies for the new regime.

↗ indiabudget.gov.in

Surcharge & Marginal Relief Rules

Surcharge thresholds and maximum rates (25% new regime, 37% old regime) applied above ₹50 lakh, ₹1 crore, and ₹2 crore.

↗ cleartax.in

India Income Tax Calculator

Free India income tax calculator comparing new vs old regime for FY 2025-26. See which regime saves you more with full deduction breakdown.

Methodology, sources & limitations

This calculator uses a published formula and the values entered in the calculator to generate the result.

Formula: 0-3L: Nil, 3-7L: 5%, 7-10L: 10%, 10-12L: 15%, 12-15L: 20%, above 15L: 30%
Jurisdiction & units: Intended for US, IN, EU, GB, AU, CA. Supports both units where applicable.
Assumptions & limitations: Results use the inputs you provide and published formulas or rate assumptions. They are estimates, not financial, tax, lending, or investment advice.
Review status: Formula and automated QA completed September 9, 2026; independent professional review is pending. Next scheduled review: December 9, 2026.

Validation sources

Income Tax Department of India
Union Budget 2025, Ministry of Finance