Calculate your income tax liability for FY 2024-25 (AY 2025-26). Compare between Old Tax Regime and New Tax Regime to find which option saves you more tax. Get detailed breakdown with deductions and exemptions.
The Union Budget 2026 made no changes to income tax slab rates. The slabs first revised under Budget 2025 continue unchanged for FY 2026-27 (AY 2027-28). Additionally, the new Income Tax Act 2025 came into effect on 1 April 2026, replacing the Income Tax Act 1961 — but without altering slab rates or deduction limits. Use our income tax calculator above to apply these slabs instantly to your own income.
| Income Slab | Tax Rate |
|---|---|
| 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% |
Standard Deduction: ₹75,000 | Section 87A Rebate: ₹60,000 (income up to ₹12,00,000)
| Effective tax-free ceiling for salaried: ₹12,75,000
| Income Slab (Below 60) | Tax Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Standard Deduction: ₹50,000 | Section 87A Rebate: ₹12,500 (income up to ₹5,00,000)
| Age-based higher exemption limits apply for senior and super-senior citizens
| Income Slab | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3,00,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
| Income Slab | Tax Rate |
|---|---|
| Up to ₹5,00,000 | Nil |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Important: Under the New Tax Regime, the same slab rates apply to all age groups — there are no higher exemption limits for senior or super-senior citizens. Age-based benefits exist exclusively under the Old Tax Regime.
Our income tax calculator applies the exact tax slabs, standard deductions, Section 87A rebate thresholds, surcharge rates, and Health & Education Cess prescribed by the Income Tax Act for FY 2026-27 (AY 2027-28). You do not need any prior tax knowledge to use it — enter your income and deduction figures, select your preferred regime, and the calculator computes your complete tax liability in seconds. Here is exactly what happens at each step.
We total your Basic Salary, HRA received, Special Allowance, and Other Income (interest, rental income, etc.) to arrive at your Gross Total Income. This is your income before any deductions or exemptions are applied.
Under the New Regime, the standard deduction of ₹75,000 is automatically subtracted. Under the Old Regime, your standard deduction (₹50,000) plus all eligible deductions you enter — 80C, 80D, HRA exemption, home loan interest, NPS, and others — are totaled and subtracted. This is where tax deductions make the biggest difference.
Gross Total Income minus total deductions gives your Taxable Income — the figure against which slab rates are actually applied. This is also the number used to determine whether you qualify for a Section 87A rebate. Our tax liability calculator displays this prominently so you understand exactly where you stand.
If your taxable income exceeds ₹50 lakh, a surcharge is added before cess is calculated: 10% for income between ₹50L–₹1Cr, 15% for ₹1Cr–₹2Cr, and 25% for income above ₹2Cr (capped at 25% under the New Regime). A Health & Education Cess of 4% is then applied on the total of base tax plus surcharge for every taxpayer regardless of income.
Finally, the income tax calculator computes your liability under both regimes simultaneously and clearly displays which saves you more — with the exact rupee difference. Use this comparison before declaring your preferred regime to your employer each April, because once declared, you typically cannot change it mid-year.
Choosing the right tax regime is one of the most impactful financial decisions a salaried individual makes each year. Run both scenarios through our income tax calculator and use the framework below to make a confident, data-backed decision.
Lower progressive slab rates (5% to 30%) applied across broader income bands. Basic exemption at ₹4 lakh. Standard deduction of ₹75,000 applies. Section 87A rebate of ₹60,000 — making income up to ₹12 lakh effectively tax-free. No HRA exemption, no 80C, no 80D, no home loan interest deduction. Simpler compliance — ideal for those with minimal investments.
Higher rates (5%, 20%, 30%) on narrower slabs. Basic exemption at ₹2.5 lakh (₹3L for seniors, ₹5L for super-seniors). Standard deduction ₹50,000. Section 87A rebate of ₹12,500 for income up to ₹5 lakh. Full suite of tax deductions available — 80C (₹1.5L), 80D, HRA, home loan interest (₹2L), NPS (₹50K additional), and more. Best for taxpayers with significant deduction claims.
The regime that saves you more tax depends entirely on how much you can legitimately claim in deductions under the Old Regime. The following break-even points are calculated using the FY 2026-27 income tax slabs:
Under the New Regime: Taxable income after ₹75,000 standard deduction = ₹7,25,000.
Tax before rebate = ₹32,500. Section 87A rebate applies — effective tax = ₹0 + 4% cess.
Under the Old Regime: Even with maximum 80C (₹1.5L) + 80D (₹25K), total
deductions of ₹2.25L bring taxable income to ₹5.75L — tax = ₹52,500 after
cess. New Regime wins clearly at this income level.
New Regime: Taxable = ₹11,25,000. Tax = ₹72,500. No 87A rebate (exceeds ₹12L
threshold post-standard deduction). With 4% cess: ~₹75,400.
Old Regime with deductions of ₹3.5L+ (80C + 80D + NPS): taxable income drops
to ~₹8L, tax ~₹75,000 after cess. Regimes are near-equal — run the
calculator with your exact deductions to decide.
New Regime: Tax ≈ ₹2,22,500 + 4% cess ≈ ₹2,31,400.
Old Regime with maximum deductions — 80C (₹1.5L) + 80D (₹50K) + NPS (₹50K) +
HRA exemption (₹1.2L) + home loan interest (₹2L) = ~₹5.7L deductions:
taxable income ~₹12.3L, tax ≈ ₹2,06,000 after cess.
Old Regime saves ≈₹25,000 — but only if all deduction claims are genuine.
At high income levels, the Old Regime’s maximum deductions (typically ₹5–6L for a heavily invested taxpayer) are a smaller percentage of total income, but the absolute tax saving can still be ₹50,000–₹80,000 annually if all deduction categories are fully utilized. Use our tax liability calculator to model the exact difference for your income — it does the math in real time.
Tax deductions are the primary reason the Old Tax Regime remains relevant for many Indian taxpayers. If you are strategic about which deductions
you claim and maximize their limits, the Old Regime can save substantially more than the New Regime — even with its lower slab rates. Enter your deduction figures in the income tax calculator above to quantify the exact benefit.
The most widely used deduction in the Indian tax code. Eligible investments include Employee Provident Fund (EPF) contributions, Public Provident Fund (PPF) deposits, ELSS mutual funds (equity-linked savings schemes), Life Insurance premiums, NSC (National Savings Certificate), 5-year tax-saving FDs, home loan principal repayment, and children’s tuition fees. Most salaried employees exhaust this limit through EPF alone — confirm with your Form 16.
Covers health insurance premiums. Deduction of up to ₹25,000 for premiums paid for self, spouse, and children. An additional ₹25,000 is allowed for parents’ insurance (₹50,000 if parents are senior citizens). If you are also a senior citizen, total deduction can reach ₹75,000. Preventive health check-up costs up to ₹5,000 (within the overall limit) are also covered. This is one of the most accessible tax deductions — everyone with a health policy should claim it.
Deduction on interest paid on a home loan for a self-occupied property. This is one of the largest available deductions and often tips the balance in favor of the Old Regime for home loan borrowers — use our EMI Calculator to see your exact monthly home loan outflow alongside your tax saving. The ₹2 lakh limit applies to self-occupied property; for let-out property, the actual interest paid is deductible without a cap (subject to overall loss set-off limits). Our income tax calculator includes this field in the deductions section.
This is a deduction over and above the ₹1.5 lakh Section 80C limit — making it especially valuable. By investing ₹50,000 in the National Pension System (NPS), a taxpayer in the 30% bracket saves an additional ₹15,600 in tax (₹15,000 + 4% cess). Combined with 80C, the total deduction potential from these two sections alone reaches ₹2,00,000.
House Rent Allowance exemption is calculated as the minimum of three values: (1) actual HRA received from employer; (2) actual rent paid minus 10% of basic salary; (3) 50% of basic salary for metro cities (40% for non-metros). This exemption can be substantial — a salaried employee in Mumbai or Delhi with a ₹30,000/month rent may claim ₹1.5–₹2.5 lakh annually. This benefit is not available under the New Tax Regime.
Section 80E covers interest on education loans for higher studies — the full interest amount paid is deductible for up to 8 years, with no upper limit. Section 80G covers donations to approved charitable institutions, with 50% or 100% of the donation amount deductible depending on the organization. Both are included in the “Other Deductions” field in the tax liability calculator above.
Employer contributions to NPS on your behalf are deductible under 80CCD(2) — and importantly, this deduction is available even under the New Tax Regime. Budget 2024 raised the limit from 10% to 14% of basic salary for private sector employees. If your employer offers this benefit, it is one of the most tax-efficient ways to build a retirement corpus while reducing your tax liability under either regime.
Available to all salaried employees and pensioners — no documentation or investment required. It is automatically applied by our income tax calculator based on your selected regime. The higher standard deduction (₹75,000) under the New Regime is one of the deliberate measures to make it more competitive for taxpayers with fewer deduction-eligible investments.
After you run the income tax calculator to establish your baseline tax figure, use these strategies to legally and systematically reduce what you owe to the government. Each one is backed by specific provisions of the Income Tax Act (now the Income Tax Act 2025 effective 1 April 2026).
The most straightforward tax deduction for salaried individuals. If your employer’s EPF contribution does not exhaust the ₹1.5L limit, top up with PPF deposits or ELSS mutual funds (which also offer market-linked returns)— our Investment Calculator can help you project the long-term growth of these instruments. ELSS has the shortest lock-in period (3 years) among 80C instruments and historically delivers higher long-term returns than PPF. At a 30% tax rate, fully utilizing 80C saves ₹46,800 in tax (₹45,000 + 4% cess).
This is an additional deduction on top of 80C — not a subset of it. For a taxpayer in the 30% bracket, this saves an extra ₹15,600 in taxes annually. The NPS also benefits from an EEE (Exempt-Exempt-Exempt) structure: contributions are deductible, the corpus grows tax-free, and 60% of the maturity amount can be withdrawn tax-free. This is one of the most tax-efficient retirement instruments available in India.
If you don’t already have a comprehensive family health plan, getting one serves a dual purpose: financial protection and a ₹25,000–₹75,000 tax deduction depending on your age and your parents’ age. A ₹50,000 80D deduction saves ₹15,600 for a 30% bracket taxpayer — often more than the annual premium itself for a basic plan. Check whether your parents’ plan qualifies (it must be a health insurance policy, not a
life insurance policy).
If you have a home loan on a self-occupied property, up to ₹2 lakh of annual interest is deductible under the Old Regime. Combined with 80C deduction for principal repayment, a home loan borrower can claim ₹3.5L+ in deductions from housing alone. This often makes the Old Regime substantially better for home loan borrowers — quantify the difference precisely using our tax liability calculator, and check your loan repayment breakdown with ourLoan Calculator.
Salaried employees can switch between regimes at the start of every financial year when they submit their investment declaration to their employer. Do not assume last year’s best regime is still optimal — your income, investments, and HRA situation may have changed. Always run both scenarios through our income tax calculator each April before declaring your regime to HR.
If you live in rented accommodation and your employer provides HRA, ensure you are claiming the full exemption your situation allows. Maintain rent receipts and a rent agreement. If your annual rent exceeds ₹1 lakh, you must provide your landlord’s PAN. Many employees under-claim this exemption simply due to poor documentation — it can mean the difference between Old and New Regime being optimal.
If you or your spouse took an education loan for higher studies, the full interest paid is deductible for up to 8 years — with no upper rupee cap. This is particularly valuable for professionals who took loans for postgraduate degrees or professional certifications. Even a ₹1 lakh annual interest deduction saves ₹31,200 for a 30% bracket taxpayer.
Donations to PM’s National Relief Fund, National Defense Fund, and certain other institutions qualify for a 100% deduction. Donations to most other approved charities are 50% deductible. If you plan to donate anyway, ensure the organization has 80G registration and that you receive a stamped receipt — the deduction reduces your taxable income and therefore your tax liability directly.
Several allowances are either fully or partially exempt from income tax — even under the Old Regime. Leave Travel Allowance (LTA), meal coupons (up to ₹50/meal for 22 working days), vehicle reimbursement for official use, and telephone/internet reimbursements can significantly reduce your taxable income when structured correctly in your CTC— for business owners and freelancers, our GST Calculator is equally useful for managing indirect tax obligations alongside income tax. Speak to your HR or payroll team if your current structure doesn’t include these.
Filing your Income Tax Return before the due date (typically 31 July for individuals not under audit) allows you to carry forward capital losses, house property losses, and business losses to set off against future gains. Missed filings forfeit this right permanently. Under the revised rules from the Income Tax Act 2025, a fee of ₹5,000 (₹1,000 for income below ₹5L) now applies for revised returns filed after the initial nine-month window — making timely compliance even more important.
Many taxpayers focus only on slab rates when using a tax liability calculator, overlooking the three additional charges that make up the final tax figure. Understanding
these is essential for accurate tax planning in FY 2026-27.
Surcharge is calculated on the base tax amount (before cess), not on income directly. Rates for FY 2026-27: 10% surcharge for income between ₹50L–₹1Cr; 15% for ₹1Cr–₹2Cr; 25% for income above ₹2Cr (under New Regime, capped at 25%; Old Regime previously allowed 37% but this has been largely aligned). Marginal relief provisions prevent the effective rate from spiking sharply just above each threshold.
A flat 4% cess is applied on the sum of your base tax and any applicable surcharge. It funds the government’s health scheme (3%) and education initiatives (1%). There is no income threshold — every rupee of income tax attracts this cess. For example, if your base tax is ₹1,00,000 and surcharge is ₹10,000, cess = 4% × ₹1,10,000 = ₹4,400, making total tax payable ₹1,14,400 — use our Percentage Calculator to quickly verify any such cess or surcharge computation on your own numbers.
Under the New Regime, individuals with taxable income up to ₹12,00,000 receive a rebate of up to ₹60,000 — effectively eliminating their tax liability entirely. For salaried taxpayers, the ₹75,000 standard deduction means gross salary up to ₹12,75,000 is effectively tax-free. Under the Old Regime, the rebate is ₹12,500 for taxable income up to ₹5,00,000. The rebate is applied before cess is calculated.
Marginal relief ensures that taxpayers earning just above ₹12,00,000 don’t face a disproportionate tax jump. For example, if your taxable income is ₹12,10,000 — just ₹10,000 above the rebate threshold — without marginal relief you’d pay full tax on ₹12,10,000. With marginal relief, your effective additional tax is capped at ₹10,000 (the income above ₹12L). Our income tax calculator applies marginal relief automatically.
Using an income tax calculator to estimate your liability is step one — filing your Income Tax Return accurately and on time is step two. Here is who must file, when, and what changes under the new Income Tax Act 2025.
Every individual whose gross total income exceeds the basic exemption limit is required to file an ITR — even if their actual tax liability is zero due to deductions or rebates. Additionally, filing is mandatory if you have deposited over ₹1 crore in bank accounts, paid electricity bills exceeding ₹1 lakh in the year, incurred foreign travel expenses above ₹2 lakh, or hold foreign assets or income. Many professionals with income below the exemption limit also file voluntarily to build a documented income history for loan applications and visa processing— if a home loan is your goal, our Mortgage Calculator can help you estimate how much you may be eligible to borrow.
31 July 2027 — Original ITR filing due date for individuals
and HUFs not subject to audit (for income earned in FY 2026-27).
31 October 2027 — For taxpayers requiring a tax audit.
31 March 2028 — Last date to file a belated or revised
return (under the Income Tax Act 2025 rules). Revised returns filed after
the initial 9-month window now attract a fee: ₹5,000 if income exceeds
₹5 lakh; ₹1,000 otherwise.
The Income Tax Act 2025 replaces the 1961 Act from 1 April 2026 — but the provisions of the old Act apply for AY 2026-27 (income earned up to 31 March 2026). The new Act simplifies language, consolidates provisions, and restructures sections, but does not change tax rates, slab structures, or deduction limits for FY 2026-27. Taxpayers will notice a different section numbering system in official communications from FY 2026-27 onwards.
Salaried employees must communicate their regime preference to their employer at the start of each financial year (April). The employer will deduct TDS accordingly. If you don’t declare, the New Regime (default) applies. Regardless of the TDS deducted, you can choose a different regime when filing your actual ITR — though the refund process may take time. Business owners who have opted into the New Regime can switch back to the Old Regime only once in their lifetime.
Our income tax calculator applies the exact tax slabs, standard deduction amounts, Section 87A rebate thresholds, surcharge rates, and 4% Health & Education Cess prescribed for FY 2026-27 (AY 2027-28). The estimates are accurate for most salaried individuals and pensioners. Results may vary slightly for taxpayers with complex income — capital gains, foreign income, business income with presumptive taxation, or ESOP perquisites — because these attract special tax treatment outside standard slab rates. For such cases, consult a Chartered Accountant or tax professional.
For the New Tax Regime (default): 0% up to ₹4L; 5% on ₹4L–₹8L; 10% on ₹8L–₹12L; 15% on ₹12L–₹16L; 20% on ₹16L–₹20L; 25% on ₹20L–₹24L; 30% above ₹24L. Standard deduction of ₹75,000 and Section 87A rebate up to ₹60,000 (for income up to ₹12L) also apply. For the Old Tax Regime: 0% up to ₹2.5L; 5% on ₹2.5L–₹5L; 20% on ₹5L–₹10L; 30% above ₹10L. These income tax slabs are unchanged from FY 2025-26 — Budget 2026 made no revisions.
Salaried employees and pensioners can switch between regimes every financial year — you declare your preference to your employer in April each year. If no declaration is made, the New Regime (default) applies automatically. You can also choose a different regime from your employer’s TDS deduction when filing your actual ITR — but any refund from the change will go through the standard refund process. Business owners and self-employed individuals who have opted for the New Regime are allowed to return to
the Old Regime only once during their lifetime.
Under the New Tax Regime, the Section 87A rebate for FY 2026-27 is ₹60,000 — applicable to resident individuals with taxable income up to ₹12,00,000. This rebate eliminates the tax liability entirely for eligible taxpayers. For salaried individuals, the ₹75,000 standard deduction means a gross salary of up to ₹12,75,000 is effectively tax-free. Under the Old Tax Regime, the 87A rebate remains ₹12,500 for taxable income up to ₹5,00,000 — unchanged from previous years.
Surcharge applies only to individuals with taxable income above ₹50 lakh. The rates are: 10% on income between ₹50L–₹1Cr; 15% on ₹1Cr–₹2Cr; 25% on income above ₹2Cr. Under the New Regime, the maximum surcharge rate is capped at 25% (the earlier 37% rate applicable under the Old Regime for ultra-high incomes has been discontinued). A 4% Health & Education Cess applies to all taxpayers regardless of income. Marginal relief is available at each surcharge threshold to prevent cliff-edge tax increases.
The New Regime is deliberately streamlined — most deductions are not available in exchange for lower slab rates. However, the following benefits do apply: Standard Deduction of ₹75,000 for salaried employees and pensioners; Section 80CCD(2) deduction for employer contributions to NPS (up to 14% of basic salary); transport allowance
for specially-abled employees; conveyance allowance actually incurred for official duties; Leave Encashment exemption at retirement; and gratuity exemption as per prescribed limits. Interest on Home Loan, 80C investments, 80D premiums, and HRA exemptions are not available under the New Regime.
Your monthly in-hand salary is your CTC minus your monthly TDS (Tax Deducted at Source) and professional tax (if applicable in your state). TDS is calculated by your employer based on your projected annual tax liability under your declared regime, divided equally across 12 months. Use our income tax calculator to get your annual tax figure, then divide by 12 to estimate monthly TDS. The “Monthly Impact” section of the results shows your estimated monthly gross, monthly tax deduction, and monthly in-hand amount side by side for easy reference.
The Income Tax Act 2025, effective 1 April 2026, replaces the Income Tax Act 1961 structurally — it simplifies language, renumbers sections, and consolidates provisions for clarity. However, it introduces no changes to tax slab rates, deduction limits, exemption thresholds, or surcharge rates for FY 2026-27. Taxpayers will notice different section references in official notices and Form 26AS from AY 2027-28 onwards, but the substantive tax liability calculation remains identical to FY 2025-26.
The due date for filing the original ITR for FY 2026-27 (AY 2027-28) for individuals not subject to audit is 31 July 2027. For taxpayers requiring a tax audit, the deadline is 31 October 2027. A belated or revised return can be filed up to 31 March 2028. Under the revised rules, revised returns filed after the initial nine-month window attract a fee: ₹5,000 for income exceeding ₹5 lakh, or ₹1,000 for income below ₹5 lakh. Filing on time also preserves your right to carry forward capital and other losses.