India Income Tax Calculator: Old vs New Regime
Compare your 2026-27 income tax under both the old and new tax regimes side by side, and see exactly which one saves you more.
How this calculator works
New regime (the default since 2023, unchanged for FY 2026-27): 0% up to ₹4 lakh, then rising in steps to 30% above ₹24 lakh. Salaried employees get a ₹75,000 standard deduction before brackets are applied. The Section 87A rebate then fully cancels out tax liability (up to ₹60,000) for anyone with taxable income up to ₹12 lakh — effectively making salaried income up to ₹12.75 lakh tax-free. A 4% health and education cess applies on top of whatever tax remains after the rebate.
Old regime (unchanged for years, still fully optional): 0% up to ₹2.5 lakh, 5% from ₹2.5–5 lakh, 20% from ₹5–10 lakh, 30% above ₹10 lakh. Salaried employees get a ₹50,000 standard deduction, and you can additionally claim your actual deductions — Section 80C (up to ₹1.5 lakh: EPF, PPF, ELSS, life insurance premiums, etc.), 80D (health insurance premiums), HRA (house rent allowance), home loan interest (Section 24b, up to ₹2 lakh), and NPS contributions under 80CCD(1B) (up to ₹50,000), among others. The Section 87A rebate here fully cancels tax (up to ₹12,500) only if taxable income — after all deductions — is ₹5 lakh or below. The same 4% cess applies to whatever tax remains.
You must actively choose the old regime every year when filing your return (non-business taxpayers can switch back and forth annually) — the new regime is applied automatically if you don't opt out.
Where your income goes
Run the calculator above to see the tax vs. take-home split.
Tax bracket breakdown (cheaper regime)
Run the calculator above to see your income split across brackets.
Common mistakes
- Assuming one regime is always better. The new regime usually wins for people with few deductions, but the old regime can still be cheaper if your 80C + 80D + HRA + home loan interest add up to a large number — run both, as this calculator now does, rather than assuming.
- Missing the standard deduction. Salaried employees get ₹75,000 off gross income in the new regime, or ₹50,000 in the old regime, before brackets apply — a common oversight when estimating tax manually.
- Not realizing the 87A rebate is a cliff, not a phase-out. In the new regime, taxable income of exactly ₹12 lakh owes zero tax; income just above that loses the full rebate, though marginal relief provisions soften the jump right at the threshold. The old regime has the same cliff behavior at ₹5 lakh.
- Double-counting deduction limits. Section 80C alone caps at ₹1.5 lakh regardless of how many eligible instruments you hold (EPF + PPF + ELSS + life insurance, etc. combined) — entering a total that ignores this cap will overstate your old-regime savings.
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Frequently Asked Questions
Which regime should I choose?
It depends entirely on your deductions. If your 80C (₹1.5 lakh cap) + 80D + HRA + home loan interest + NPS add up to a large number relative to your income, the old regime often wins. If you have few deductions, the new regime's lower rates and bigger effective tax-free threshold (₹12.75 lakh for salaried employees) usually win. Enter your numbers above and this calculator shows you both figures side by side.
Is the new tax regime mandatory?
No, but it is the default. Taxpayers can still opt for the old regime with its deductions and exemptions if that results in lower tax for their specific situation — salaried individuals can switch between regimes every year when filing.
How does the Section 87A rebate work in each regime?
In the new regime, it fully offsets tax liability (up to ₹60,000) for taxable income up to ₹12 lakh, making that income effectively tax-free. In the old regime, it fully offsets tax liability (up to ₹12,500) only for taxable income up to ₹5 lakh — a much lower threshold, since the old regime relies on itemized deductions instead of a high blanket exemption.
What deductions can I claim under the old regime but not the new one?
Section 80C (EPF, PPF, ELSS, life insurance premiums, up to ₹1.5 lakh), 80D (health insurance premiums), HRA (house rent allowance), home loan interest under Section 24b (up to ₹2 lakh), and NPS contributions under 80CCD(1B) (up to ₹50,000) are all old-regime-only. The new regime disallows nearly all of these in exchange for lower tax rates.
Does this include surcharge?
This simplified version excludes surcharge, which applies to income above ₹50 lakh at rates of 10-25% depending on income level (up to 37% under the old regime), plus the 4% cess on the total including surcharge.