Income Tax Calculator India 2026 - New vs Old Tax Regime

Last updated: · FY 2026-27 / AY 2027-28

Calculate Your Income Tax for FY 2026-27

Enter your annual income to compare tax liability under both new and old tax regimes.

₹
Enter your total annual income before deductions
Age affects basic exemption limit under old regime (₹2.5L / ₹3L / ₹5L)
Choose to compare both or calculate for specific regime

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Which Tax Regime is Better in India?

Understanding New vs Old Tax Regime

From April 2020, the Indian government introduced a new tax regime with lower tax rates but without most deductions and exemptions. Taxpayers can choose between the old regime (with deductions) and new regime (without deductions) based on what saves them more tax.

New Tax Regime (FY 2026-27) — Budget 2025 Slabs

Tax slabs under the new regime (revised in Union Budget 2025):

  • ₹0 to ₹4,00,000: Nil
  • ₹4,00,001 to ₹8,00,000: 5%
  • ₹8,00,001 to ₹12,00,000: 10%
  • ₹12,00,001 to ₹16,00,000: 15%
  • ₹16,00,001 to ₹20,00,000: 20%
  • ₹20,00,001 to ₹24,00,000: 25%
  • Above ₹24,00,000: 30%

Standard Deduction: ₹75,000 for salaried individuals under new regime (increased from ₹50,000 in Budget 2024)

Section 87A Rebate: Income up to ₹12 lakh is effectively tax-free (₹12.75 lakh for salaried with standard deduction)

No deductions under Section 80C, 80D, HRA, LTA, etc.

Old Tax Regime (FY 2026-27)

Tax slabs under the old regime (unchanged):

  • ₹0 to ₹2,50,000: Nil
  • ₹2,50,001 to ₹5,00,000: 5%
  • ₹5,00,001 to ₹10,00,000: 20%
  • Above ₹10,00,000: 30%

Standard Deduction: ₹50,000 (unchanged from previous year)

Available deductions:

  • Section 80C: Up to ₹1,50,000 (PPF, ELSS, Life Insurance, etc.)
  • Section 80D: Up to ₹25,000 self (₹50,000 senior); max ₹1,00,000 with parents
  • Section 80CCD(1B): Additional ₹50,000 for NPS
  • HRA exemption (for salaried individuals)
  • LTA (Leave Travel Allowance)
  • Home loan interest deduction

Who Should Choose New Tax Regime?

  • Anyone earning up to ₹12.75 lakh (salaried) — you pay zero tax under new regime
  • Individuals with lower deductions (less than ₹3-4 lakhs total)
  • Those who don't invest in tax-saving instruments
  • Those who prefer simpler tax filing without claiming deductions

Who Should Choose Old Tax Regime?

  • Individuals who actively invest in tax-saving instruments
  • Those claiming HRA exemption
  • People with home loans (claiming interest deduction)
  • High earners (above ₹15 lakhs) with substantial deductions
  • Senior citizens with medical expenses

Income Tax Saving Tips for India

Popular Tax Saving Investments (Section 80C)

  • Public Provident Fund (PPF): Safe investment with tax-free returns
  • Equity Linked Savings Scheme (ELSS): Mutual funds with 3-year lock-in
  • Life Insurance Premium: Term and traditional insurance policies
  • National Pension System (NPS): Retirement savings with additional ₹50,000 benefit
  • Tax Saver Fixed Deposits: 5-year FDs with guaranteed returns
  • Sukanya Samriddhi Yojana: For girl child education and marriage
  • Employee Provident Fund (EPF): Mandatory for salaried employees

Health Insurance (Section 80D)

  • Self, spouse, and children: Up to ₹25,000
  • Parents (below 60 years): Additional ₹25,000
  • Parents (above 60 years): Additional ₹50,000
  • Preventive health check-up: ₹5,000 within above limits

Other Important Deductions

  • Section 24(b): Home loan interest up to ₹2,00,000
  • Section 80E: Education loan interest (no limit)
  • Section 80G: Donations to charitable organizations
  • Section 80TTA: Savings account interest up to ₹10,000
  • Section 80CCD(1B): Additional NPS contribution up to ₹50,000

Tax Planning Timeline

Don't wait until March 31st to plan your taxes. Start early:

  • April-June: Review last year's returns, plan for current year
  • July-December: Invest in tax-saving instruments gradually
  • January-March: Complete remaining investments, submit proofs to employer
  • Before July 31: File your income tax return

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Calculate your salary, loan EMI, or HRA exemption

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How This Calculator Works

This calculator computes income tax in two steps for each regime:

  1. Taxable income = Gross salary − Standard deduction (‍₹50,000) − declared deductions (old regime only)
  2. Tax on slabs = Apply progressive slab rates to taxable income, then add 4% Health & Education Cess

Section 87A rebate: Under the new regime, if taxable income ≤ ₹7,00,000, tax payable is ₹0. Under the old regime, rebate applies if taxable income ≤ ₹5,00,000.
Source: Finance Act 2026 (Union Budget, February 2026) · CBDT FY 2026-27 / AY 2027-28

Frequently Asked Questions (FAQ)

Which tax regime is better for me - old or new?

It depends on your income and deductions. The new tax regime offers lower tax rates but no deductions under Section 80C, 80D, etc. The old regime has higher rates but allows deductions. Use our calculator to compare both regimes based on your income.

What is the standard deduction in FY 2026-27?

For FY 2026-27, the standard deduction is ₹75,000 under the new tax regime (carried forward from Budget 2025, confirmed by Finance Act 2026) and ₹50,000 under the old tax regime.

Can I switch between old and new tax regime?

Yes, salaried individuals can switch between old and new tax regimes every year. However, business owners can switch only once during their lifetime.

What are the new tax slabs for FY 2026-27?

Under new regime (Budget 2025): 0-4L: Nil, 4-8L: 5%, 8-12L: 10%, 12-16L: 15%, 16-20L: 20%, 20-24L: 25%, Above 24L: 30%. Income up to ₹12.75L is effectively tax-free for salaried (₹75K standard deduction + Section 87A rebate). Under old regime: 0-2.5L: Nil, 2.5-5L: 5%, 5-10L: 20%, Above 10L: 30%.

What is Section 87A rebate?

Section 87A provides a tax rebate. Under the new regime, if your taxable income is up to ₹7 lakhs, you get a rebate equal to the tax amount, effectively making your tax liability zero.

When is the deadline to file income tax return?

For individuals, the deadline is July 31st of the assessment year. For businesses requiring audit, it's September 30th. Late filing attracts penalties.

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Disclaimer: This income tax calculator provides approximate estimations based on standard tax slabs for FY 2026-27. Actual tax liability may vary based on specific circumstances, additional income sources, surcharge applicability, and other factors. This calculator does not consider TDS, advance tax, or other complex scenarios. Please consult a chartered accountant or tax professional for accurate tax planning and filing.