Enter your income once and see your tax under both the old and new regimes side by side, with a clear answer on which one actually saves you more money this year.
Most of these are not allowed under the new regime, so they only reduce your old regime tax below. Leave any that don’t apply to you at zero.
| Item | New Regime | Old Regime |
|---|
This calculator covers standard salaried and pension income for resident individuals. It applies simplified surcharge slabs for very high incomes without full marginal relief adjustment – if your income is above Rs 50 lakh, verify your exact surcharge and marginal relief with a tax professional or the official income tax e-filing portal.
Two Regimes, One Decision
Since the new tax regime became the default a few years ago, every taxpayer effectively makes an annual choice: stick with the lower, simpler new-regime slabs and give up most deductions, or use the higher old-regime slabs and claim every deduction you’re entitled to. There’s no universal right answer – it depends entirely on how much you actually invest, spend, and claim each year. This calculator runs both numbers side by side so you don’t have to guess.
New Regime Slabs for FY 2026-27
| Taxable Income | Rate |
|---|---|
| Up to Rs 4,00,000 | Nil |
| Rs 4,00,001 – Rs 8,00,000 | 5% |
| Rs 8,00,001 – Rs 12,00,000 | 10% |
| Rs 12,00,001 – Rs 16,00,000 | 15% |
| Rs 16,00,001 – Rs 20,00,000 | 20% |
| Rs 20,00,001 – Rs 24,00,000 | 25% |
| Above Rs 24,00,000 | 30% |
Standard deduction under this regime is Rs 75,000 for salaried individuals and pensioners. Section 87A gives a full rebate of up to Rs 60,000 when your taxable income is Rs 12,00,000 or less, which is why salary up to roughly Rs 12.75 lakh often works out completely tax-free for salaried taxpayers.
Old Regime Slabs – These Still Depend on Your Age
| Taxable Income | Below 60 | 60 to 79 | 80 and Above |
|---|---|---|---|
| Up to Rs 2,50,000 | Nil | Nil | Nil |
| Rs 2,50,001 – Rs 3,00,000 | 5% | Nil | Nil |
| Rs 3,00,001 – Rs 5,00,000 | 5% | 5% | Nil |
| Rs 5,00,001 – Rs 10,00,000 | 20% | 20% | 20% |
| Above Rs 10,00,000 | 30% | 30% | 30% |
This is the one place where age still changes your tax bill directly – the new regime uses identical slabs for every age group, but the old regime gives senior and super senior citizens a higher tax-free starting point. Standard deduction under the old regime is Rs 50,000, and Section 87A here caps out much lower – a rebate of up to Rs 12,500 when taxable income is Rs 5,00,000 or less.
Reading What This Calculator Shows You
Enter your gross annual income, confirm whether you’re salaried (this decides if the standard deduction applies), and pick your age bracket. The deduction fields below only affect the old regime side of the comparison, since the new regime doesn’t allow most of them – fill in only what genuinely applies to you, like your actual 80C investments or actual home loan interest paid, not the maximum permitted amount if you haven’t invested that much. The two cards show your tax under each regime, and the highlighted one with the badge is whichever comes out cheaper for your specific numbers.
Why the “Right” Regime Changes From Person to Person
Someone with no home loan, minimal insurance, and no 80C investments will almost always do better under the new regime, since there’s nothing to claim under the old one anyway and the new regime’s lower rates and larger standard deduction win outright. Someone with a home loan pushing Rs 2 lakh of interest, a full Rs 1.5 lakh in 80C, health insurance, and NPS contributions can easily rack up Rs 4 lakh or more in deductions – at that point the old regime’s higher slabs frequently work out cheaper despite the steeper rate structure, because so much income never gets taxed at all.
Surcharge on Very High Incomes
Beyond the basic slabs, a surcharge applies on the tax itself once your income crosses certain thresholds – 10% above Rs 50 lakh, 15% above Rs 1 crore, and 25% above Rs 2 crore. The old regime adds a further 37% surcharge slab above Rs 5 crore, but the new regime caps its maximum surcharge at 25% regardless of how high your income goes, which is a meaningful advantage for very high earners. Marginal relief provisions can reduce the surcharge further right at each threshold boundary – this calculator applies the straightforward surcharge rate without that fine marginal-relief adjustment, so treat results above Rs 50 lakh as a close estimate rather than an exact figure.
Frequently Asked Questions (FAQs)
Ans. Yes, for most resident individuals, taxable income up to ₹12 lakh can effectively become tax-free because of the Section 87A rebate. Under the new regime, tax is first calculated according to the applicable slab rates and then a rebate of up to ₹60,000 is applied if taxable income does not exceed ₹12 lakh. For salaried taxpayers, the ₹75,000 standard deduction can further increase the tax-free income level to approximately ₹12.75 lakh. If taxable income exceeds the rebate threshold, tax liability may increase, although marginal relief provisions may reduce the immediate impact in certain cases.
Ans. Salaried individuals and pensioners who do not have business or professional income can choose either tax regime every financial year while filing their Income Tax Return (ITR). However, taxpayers with business or professional income are subject to specific restrictions when switching between regimes. Such taxpayers should review the applicable rules before making a change.
Ans. The new tax regime follows a uniform slab structure for all taxpayers, regardless of age. The old regime, however, provides higher basic exemption limits for senior citizens and super senior citizens. Individuals aged 60 to 79 years receive a basic exemption limit of ₹3 lakh, while those aged 80 years and above receive a basic exemption limit of ₹5 lakh, resulting in a lower tax liability compared to taxpayers below 60 years of age.
Ans. The new tax regime allows only a limited number of deductions and exemptions. Salaried individuals and pensioners can claim the standard deduction of ₹75,000. Employer contributions to the National Pension System (NPS) under Section 80CCD(2) are also eligible. Most commonly used deductions, including Section 80C investments, Section 80D health insurance premiums, home loan interest under Section 24(b), and HRA exemption, are generally not available under the new regime.
Ans. Not necessarily. A home loan can provide significant tax benefits under the old regime, including a deduction of up to ₹2 lakh on interest paid for a self-occupied property under Section 24(b). When combined with deductions such as Section 80C, Section 80D, and NPS contributions, the old regime may become more beneficial. However, the final outcome depends on your total income and deductions, so comparing both regimes is the best way to determine which one results in lower tax liability.
Ans. Health and Education Cess is an additional levy charged at 4% of the total income tax payable after applying any eligible rebate. It is applicable under both the old and new tax regimes and is added to the final tax amount calculated by the taxpayer.
Ans. The calculator applies the standard surcharge rates prescribed under the Income Tax Act. These rates currently begin when total income exceeds ₹50 lakh. However, the calculator does not fully account for marginal relief, which may reduce the surcharge burden for taxpayers whose income is only slightly above a surcharge threshold. Therefore, individuals with income above ₹50 lakh should treat the result as an estimate and verify the exact tax liability through the Income Tax Department portal or a qualified tax professional.
Ans. No. As per the latest Finance Act and Budget announcements applicable to FY 2026-27, there were no changes to the income tax slab rates, standard deduction amounts, Section 87A rebate provisions, surcharge rates, or Health and Education Cess under either tax regime. The tax structure remains the same as that introduced for FY 2025-26.
Ans. The new tax regime continues to be the default tax regime for individual taxpayers. If a taxpayer wishes to be taxed under the old regime and is eligible to do so, they must choose that option while filing their Income Tax Return or through the prescribed procedure applicable to their category of taxpayer.
Ans. Yes. Salaried employees and pensioners can claim a standard deduction under both tax regimes. The standard deduction is ₹75,000 under the new regime and ₹50,000 under the old regime, subject to the prevailing provisions applicable for FY 2026-27.
Ans. Yes. Pensioners can opt for either the old tax regime or the new tax regime, depending on which is more suitable for their financial situation. Pension income is generally treated similarly to salary income for the purpose of standard deduction benefits available under the applicable tax regime.
Ans. There is no single answer that applies to every taxpayer. The new regime generally benefits individuals with fewer deductions and exemptions, while the old regime may be advantageous for those claiming substantial deductions such as Section 80C investments, home loan interest, health insurance premiums, and NPS contributions. The most reliable approach is to calculate tax under both regimes and compare the final tax liability before making a decision.
Tabassum is a government document researcher and writer with over 5 years of experience exclusively dedicated to tracking and simplifying Central and State Government document processes across India. She has researched and published detailed guides on 100+ government documents and certificates – including Aadhaar Card, PAN Card, Ration Card, Domicile Certificate, and Birth Certificate – covering all states and the Central Government, helping lakhs of Indian citizens successfully complete their paperwork in simple, easy-to-understand language.