Compare Old vs New regime tax — FY 2025-26 & FY 2026-27
Built & maintained by Pappu Venkata Subbi Reddy, founder of Clacify · Updated July 2026 · Formulas verified against official Indian government sources
The Income Tax Calculator compares your tax liability under the Old and New tax regimes — valid for both FY 2025-26 (assessment year 2026-27, the return you file in 2026) and the current FY 2026-27, since Union Budget 2026 made no changes to the slabs announced in Budget 2025. Enter your annual income, and for the Old regime your deductions (80C, 80D, HRA, home-loan interest, NPS, etc.), and it shows the tax payable under each regime so you can pick the cheaper one. The New regime makes income up to ₹12 lakh effectively tax-free through the Section 87A rebate (₹12.75 lakh for salaried taxpayers after the ₹75,000 standard deduction), which is why most taxpayers without large deductions now prefer it.
The New regime for FY 2025-26 and FY 2026-27 (identical slabs — Budget 2026 changed nothing) applies these slabs: nil up to ₹4 lakh, 5% from ₹4–8 lakh, 10% from ₹8–12 lakh, 15% from ₹12–16 lakh, 20% from ₹16–20 lakh, 25% from ₹20–24 lakh, and 30% above ₹24 lakh, with a ₹75,000 standard deduction for salaried taxpayers and a Section 87A rebate that zeroes tax for taxable income up to ₹12 lakh. The Old regime retains the 5%/20%/30% slabs with the ₹1.5 lakh 80C, ₹50,000 standard deduction, and other deductions. Tax is computed slab by slab, then a 4% health and education cess is added. This is an estimate for planning; consult a CA or the official ITR utility for filing.
| Gross salary | Tax + 4% cess | Effective rate |
|---|---|---|
| ₹8,00,000 | ₹0 | 0% |
| ₹10,00,000 | ₹0 | 0% |
| ₹12,75,000 | ₹0 | 0% |
| ₹15,00,000 | ₹97,500 | 6.5% |
| ₹20,00,000 | ₹1,92,400 | 9.6% |
| ₹25,00,000 | ₹3,19,800 | 12.8% |
| ₹50,00,000 | ₹10,99,800 | 22.0% |
Up to ₹12.75 lakh gross, a salaried taxpayer pays zero tax under the new regime: the ₹75,000 standard deduction brings taxable income to ₹12 lakh, and the Section 87A rebate then wipes out the tax. A surcharge applies above ₹50 lakh and is not shown here.
It is not a raised slab — it is a rebate. Under the new regime, income is still taxed slab by slab from ₹4 lakh upward, but Section 87A (renumbered Section 157 under the Income Tax Act 2025, effective 1 April 2026) gives a rebate that fully cancels the tax whenever your taxable income is ₹12 lakh or less. Add the ₹75,000 standard deduction and a salaried person earning up to ₹12.75 lakh gross pays nothing. Earn ₹1 above the threshold, though, and tax applies on the amount over ₹4 lakh — so a small raise near the limit can briefly cost you (marginal relief softens this edge).
On a ₹15 lakh salary, the ₹75,000 standard deduction leaves ₹14.25 lakh taxable. Tax is nil up to ₹4 lakh, 5% on ₹4–8 lakh (₹20,000), 10% on ₹8–12 lakh (₹40,000), and 15% on the ₹2.25 lakh from ₹12–14.25 lakh (₹33,750). That totals ₹93,750, plus 4% health & education cess (₹3,750) = ₹97,500 — an effective rate of just 6.5%, even though the top slab touched is 15%.
The new regime is simpler and usually cheaper if you have few deductions. The old regime can still win if your deductions are large — a full ₹1.5 lakh under 80C, ₹25,000–50,000 under 80D, significant HRA, and up to ₹2 lakh of home-loan interest can together lower old-regime tax below the new. As a rough rule, if your total deductions exceed roughly ₹4–4.5 lakh, run both and compare. This tool does that side by side.
Union Budget 2026 left the income tax slabs untouched — FY 2026-27 uses exactly the same rates, standard deduction, and rebate as FY 2025-26, and the New regime remains the default. The headline change is procedural: the Income Tax Act, 2025 replaced the six-decade-old 1961 Act from 1 April 2026, simplifying language and renumbering sections — the familiar Section 87A rebate, for instance, is now Section 157, and "assessment year" terminology gives way to "tax year". Your tax amount does not change; only the section numbers on paperwork do. This calculator's results are therefore valid both for filing your FY 2025-26 return (due in 2026) and for planning FY 2026-27 declarations to your employer.
No. Union Budget 2026 made no changes to the tax slabs — FY 2026-27 uses the same slabs and rates as FY 2025-26 under both regimes, and the New Regime remains the default. The main change is procedural: the new Income Tax Act, 2025 became operational from 1 April 2026, renumbering sections (e.g. the 87A rebate is now Section 157) without changing the rates.
Yes, under the New Tax Regime — in both FY 2025-26 and FY 2026-27. The standard deduction is ₹75,000, bringing taxable income to ₹11.25 lakh. The ₹60,000 rebate (Section 87A, now Section 157) covers the full tax liability, making effective tax payable zero on income up to ₹12 lakh. Income above ₹12 lakh is taxed at regular slab rates.
The New Regime is generally better if your total deductions under 80C, 80D, HRA, and other sections are below ₹3–4 lakh. If you have a home loan with large interest deductions, HRA exemption, or invest the full ₹1.5 lakh in 80C instruments, the Old Regime may still save more tax. Use the calculator to compare with your exact numbers.