Evaluating your personal income tax obligations in India requires comparing the concessional slab structure of the New Tax Regime against the deductions and exemptions of the Old Tax Regime. This calculator computes net taxable income, applicable surcharges, cess, and marginal relief under prevailing statutory tax laws.
🧾 Income Tax Calculator
Calculate your income tax liability and compare Old vs New Slabs. Dynamic adjustments apply immediately!
Income Tax Calculator: Old vs New Tax Regime (FY 2025-26 & 2026-27)
📋 What, Why, and Who Should Use It?
🔍 What is this Calculator?
An interactive income tax estimation engine that models liability under both Section 115BAC (New Tax Regime) and the regular Old Tax Regime slabs for Indian resident taxpayers.
⚡ Why is it Useful?
Enables salaried and self-employed taxpayers to evaluate tax liability across regimes, accounting for standard deductions, HRA, Section 80C, 80D, and home loan interest.
👥 Who Should Use It?
Salaried employees, professionals, pensioners, and individual taxpayers seeking objective calculation comparisons for annual tax planning.
⚙️ How It Works & Calculation Formula
Tax is computed progressively across income slabs after subtracting eligible deductions. Under the New Tax Regime (Section 115BAC), standard deduction is ₹75,000 for salaried individuals. For FY 2024-25, the Section 87A rebate provides a maximum relief of ₹25,000 for taxable income up to ₹7,00,000 (effective zero-tax gross income of ₹7,75,000). For FY 2026-27 (and FY 2025-26), the Section 87A rebate extends up to ₹12,00,000 (maximum rebate ₹60,000), resulting in an effective zero-tax gross income of ₹12,75,000. Under the Old Regime, standard deduction remains ₹50,000 with an 87A rebate up to ₹12,500 for taxable income up to ₹5,00,000 (effective zero-tax income of ₹5,50,000). Surcharges and a flat 4% Health & Education Cess are added to basic tax.
💡 Assumptions & Real-World Example
Assumes an individual resident taxpayer under 60 years of age. Deductions under Old Regime are based on user inputs for Section 80C, 80D, 24(b), and HRA. Surcharge rates and 4% Health & Education Cess are applied strictly according to statutory thresholds for the selected financial year.
📌 FAQs
1. What is the standard deduction in the New Tax Regime? ▼
Under Section 115BAC (New Tax Regime), the standard deduction for salaried individuals and pensioners is ₹75,000 (effective from FY 2024-25 onwards). In the Old Tax Regime, standard deduction remains ₹50,000.
2. What is the tax-free income threshold under Section 87A for FY 2026-27 vs FY 2024-25? ▼
For FY 2026-27 (and FY 2025-26), resident individuals with taxable income up to ₹12,00,000 receive a Section 87A rebate up to ₹60,000, making gross salary up to ₹12,75,000 zero-tax with standard deduction. For FY 2024-25, the 87A rebate applied up to ₹7,00,000 taxable income, making gross salary up to ₹7,75,000 tax-free. Under the Old Regime, the rebate applies up to ₹5,00,000 taxable income (effective ₹5,50,000 with standard deduction) across all years.
3. Can salaried employees switch between Old and New regimes each year? ▼
Yes. Salaried employees with no business or professional income can switch between the Old and New regimes every financial year when filing their ITR. Individuals with business income can switch back to the Old regime only once in their lifetime.
4. How is HRA exemption calculated under Section 10(13A)? ▼
HRA exemption is the lowest of: (1) Actual HRA received, (2) Rent paid minus 10% of basic salary + DA, or (3) 50% of basic salary for metro cities (Delhi, Mumbai, Kolkata, Chennai) or 40% for non-metro cities. HRA exemption is only available under the Old Tax Regime.
5. Are Section 80C deductions available in the New Tax Regime? ▼
No. Section 80C deductions (PPF, EPF, ELSS, life insurance, home loan principal) are disallowed under the New Tax Regime. They are only claimable under the Old Tax Regime.
6. Can home loan interest under Section 24(b) be claimed in the New Regime? ▼
Interest on a home loan for a self-occupied property (up to ₹2,00,000) under Section 24(b) is disallowed under the New Regime. It can only be claimed in the Old Regime. For let-out properties, interest deduction is permitted up to the rental income under the New Regime.
7. What are the maximum surcharge rates under both regimes? ▼
Under the New Tax Regime, the maximum surcharge rate is capped at 25% for taxable income above ₹2 Crores. Under the Old Tax Regime, the surcharge can go up to 37% for taxable income exceeding ₹5 Crores.
8. What is the Health & Education Cess rate? ▼
The Health & Education Cess is mandatory and levied at a flat rate of 4% on the sum of basic income tax payable and applicable surcharges across both regimes.
9. How does marginal relief work under Section 115BAC? ▼
Marginal relief ensures that taxpayers whose net income slightly exceeds ₹7,00,000 do not pay more in income tax than the excess amount earned above ₹7,00,000.
10. Is employer contribution to NPS deductible in the New Regime? ▼
Yes. Employer contribution to NPS under Section 80CCD(2) up to 14% of salary for government employees and up to 10% (14% for corporate under budget update) for non-government employees remains deductible under the New Regime.
