Income Tax Calculator (Old vs New Regime)
Enter your annual income and deductions to compare the old and new tax regimes for FY 2025-26 and FY 2026-27. We calculate your tax slab-by-slab, apply the Section 87A rebate and 4% cess, and show which regime saves you more.
Enter your annual income above to see your tax and the better regime.
Estimated tax
₹0
New regime ✓ better
₹0
Old regime ✓ better
₹0
How your income tax is calculated
India runs two parallel income tax systems, and you may pick whichever is cheaper for you each year. This calculator works out your liability under both so the choice is obvious. The tax is never a flat percentage of your salary — it is charged slab by slab. Only the portion of your income that falls inside a slab is taxed at that slab's rate, so a higher income never makes your earlier rupees more expensive.
The starting point is your net taxable income. From your gross income we subtract the standard deduction — ₹75,000 in the new regime and ₹50,000 in the old regime for salaried people and pensioners. In the old regime you may subtract more: Section 80C investments (up to ₹1.5 lakh), 80D health insurance, home loan interest (up to ₹2 lakh) and allowances such as HRA. The new regime trades almost all of these away in return for wider, lower slabs.
We then apply the slab rates to what remains. Under the new regime for FY 2025-26 and FY 2026-27, income up to ₹4 lakh is tax-free, then 5%, 10%, 15%, 20%, 25% and 30% bands follow every ₹4 lakh up to ₹24 lakh and above. The old regime keeps the familiar nil / 5% / 20% / 30% structure, with a higher tax-free limit for senior and super-senior citizens.
Next comes the Section 87A rebate, which cancels tax for lower incomes. In the new regime it makes tax nil up to ₹12 lakh of taxable income (about ₹12.75 lakh of salary after the standard deduction); in the old regime it does so up to ₹5 lakh. Just above the ₹12 lakh mark a marginal relief rule stops a small rise in income from triggering a large jump in tax. Finally we add a 4% health and education cess on the tax, plus a surcharge if your income runs into the higher brackets above ₹50 lakh.
Because Budget 2026 left the slabs unchanged, the figures for FY 2025-26 and FY 2026-27 are identical. The result updates instantly as you type, so you can test different incomes and deductions to plan your year. Always confirm the final number against the Income Tax Department before you file.
Frequently asked questions
Which tax regime is better — old or new?
It depends on your deductions. The new regime has lower slab rates and a larger rebate, so it wins for most people with few deductions. The old regime can still win if your eligible deductions (80C, 80D, home loan interest, HRA) are large. This calculator computes both and tells you which costs less.
Is income up to ₹12 lakh really tax-free under the new regime?
Yes. For FY 2025-26 and FY 2026-27 the Section 87A rebate makes tax nil for net taxable income up to ₹12,00,000 under the new regime. For a salaried person the ₹75,000 standard deduction pushes this to roughly ₹12,75,000 of gross salary.
Can I claim the standard deduction in the new regime?
Yes. Salaried taxpayers and pensioners get a ₹75,000 standard deduction in the new regime (₹50,000 in the old regime). Other deductions such as 80C and 80D are only available in the old regime.
What is the Section 87A rebate?
It is a rebate that reduces your tax to zero below a threshold. In the new regime it is up to ₹60,000 (nil tax up to ₹12,00,000 taxable). In the old regime it is up to ₹12,500 (nil tax up to ₹5,00,000 taxable).
Are the FY 2025-26 and FY 2026-27 tax slabs the same?
Yes. Budget 2026 made no changes to the income tax slabs, so FY 2025-26 and FY 2026-27 use identical slabs in both regimes. Always re-verify against the Income Tax Department before filing.
This calculator is for general information only and is not tax advice. Figures are estimates based on publicly announced slabs for FY 2025-26 and FY 2026-27; verify with the Income Tax Department or a qualified advisor before filing.