Every salaried taxpayer in India has to choose between the new tax regime (lower rates, almost no deductions) and the old tax regime (higher rates, but deductions like 80C, 80D, HRA and home-loan interest). This calculator works out your tax under both for FY 2026-27 (AY 2027-28) and tells you which one costs less.
How to use it
- Enter your gross annual income (salary before deductions, plus other taxable income).
- Choose salary/pension or other income – only salaried people and pensioners get the standard deduction.
- Pick your age group – it changes old-regime slabs for senior citizens.
- Enter the deductions you actually claim. They only affect the old regime.
FY 2026-27 tax slabs
New regime (default)
| Taxable income | Rate |
|---|---|
| Up to ₹4 lakh | Nil |
| ₹4–8 lakh | 5% |
| ₹8–12 lakh | 10% |
| ₹12–16 lakh | 15% |
| ₹16–20 lakh | 20% |
| ₹20–24 lakh | 25% |
| Above ₹24 lakh | 30% |
Standard deduction: ₹75,000. Rebate: tax is nil when taxable income is up to ₹12 lakh, with marginal relief just above that so you never pay more tax than the income above ₹12 lakh.
Old regime (below 60 years)
| Taxable income | Rate |
|---|---|
| Up to ₹2.5 lakh | Nil |
| ₹2.5–5 lakh | 5% |
| ₹5–10 lakh | 20% |
| Above ₹10 lakh | 30% |
Standard deduction: ₹50,000. Rebate: nil tax up to ₹5 lakh taxable income. Senior citizens (60–79) get a ₹3 lakh basic exemption and super seniors (80+) ₹5 lakh.
A 4% health and education cess is added in both regimes. Surcharge applies above ₹50 lakh.
Which regime is better?
For most people earning up to about ₹15 lakh, the new regime wins comfortably because of the ₹12 lakh rebate and lower rates. The old regime starts to make sense only when your deductions are large – typically a combination of full 80C (₹1.5 lakh), HRA exemption in a big city, home-loan interest (up to ₹2 lakh) and health insurance. The calculator shows the exact break-even for your numbers.
Example
Gross salary ₹15 lakh, 80C ₹1.5 lakh and 80D ₹25,000:
- New regime: taxable ₹14.25 lakh → tax ₹97,500 including cess.
- Old regime: taxable ₹12.75 lakh → tax ₹2,02,800 including cess.
The new regime saves ₹1,05,300. The old regime would only win here with roughly ₹3.7 lakh more in deductions (for example HRA plus home-loan interest).
Tax at a glance: salaried individuals (FY 2026-27)
Tax including 4% cess for a salaried person below 60, assuming full 80C (₹1.5 lakh) and ₹25,000 of 80D in the old regime and no other deductions:
| Gross salary | New regime tax | Old regime tax | Better choice |
|---|---|---|---|
| ₹8 lakh | ₹0 | ≈ ₹28,600 | New |
| ₹12.75 lakh | ₹0 | ≈ ₹1.32 lakh | New |
| ₹15 lakh | ₹97,500 | ≈ ₹2.03 lakh | New |
| ₹20 lakh | ≈ ₹1.92 lakh | ≈ ₹3.59 lakh | New |
| ₹30 lakh | ≈ ₹4.76 lakh | ≈ ₹6.71 lakh | New |
With only 80C and 80D, the new regime wins at every income level. The picture changes when you add a large HRA exemption and home-loan interest – which is exactly what the calculator lets you test.
Deductions that only work in the old regime
- 80C (up to ₹1.5 lakh): EPF, PPF, ELSS, life insurance premiums, home-loan principal, children’s tuition fees, 5-year tax-saver FDs, Sukanya Samriddhi.
- 80D: health insurance – up to ₹25,000 for yourself and family, plus ₹25,000 (₹50,000 if they’re seniors) for parents.
- HRA exemption: for rent paid – calculate it with the HRA calculator.
- Home-loan interest: up to ₹2 lakh for a self-occupied house.
- 80CCD(1B): an extra ₹50,000 for your own NPS contributions.
- Others: education-loan interest (80E), donations (80G), savings-account interest up to ₹10,000 (80TTA).
What still works in the new regime
- ₹75,000 standard deduction for salaried people and pensioners.
- Employer contribution to NPS, up to 14% of basic salary.
- Family pension deduction and Agniveer Corpus Fund contributions.
- Exemptions such as gratuity, leave encashment on retirement and voluntary retirement compensation, within their limits.
Finding your break-even deduction
A simple way to decide: enter your salary, set all deductions to zero, and note the new-regime tax. Then raise the old-regime deductions until the old-regime tax falls below it. For a ₹15 lakh salary, total old-regime deductions (including the ₹50,000 standard deduction) need to exceed roughly ₹5.9 lakh before the old regime wins. Most people can’t reach that without both a sizeable HRA exemption and home-loan interest.
How to declare your choice
Tell your employer which regime you want at the start of the year so they deduct the right TDS. If you don’t, the new regime applies by default. You can still pick the other regime when you file your return, as long as you don’t have business income.
FAQs
Is the ₹12 lakh rebate available on capital gains?
No. The rebate does not apply to income taxed at special rates, such as short-term capital gains on listed shares or long-term capital gains above the yearly exemption.
What is marginal relief?
If your taxable income is slightly above ₹12 lakh, marginal relief caps your tax at the amount by which income exceeds ₹12 lakh. Someone with ₹12.1 lakh of taxable income pays at most ₹10,000 plus cess, not the full slab tax.
Can I switch regimes every year?
Salaried individuals without business income can choose each year when filing their return. People with business income can switch back from the new regime only once.
Is employer NPS deductible in the new regime?
Yes. Your employer’s NPS contribution up to 14% of basic salary is deductible under both regimes (up to 10% in the old regime for private-sector employees).
Does the new Income-tax Act 2025 change these numbers?
The new Act, effective 1 April 2026, renumbers sections and simplifies wording, but the FY 2026-27 slab rates, standard deduction and rebate above are unchanged from FY 2025-26.
Estimates only – capital gains, special-rate income and surcharge marginal relief are not modelled. Check with a tax professional for complex cases.