Income Tax Calculator
Estimate and compare your tax liabilities under the Old and New Tax Regimes for Financial Year 2025-26. Find out which regime saves you more money.
Annual salary before deductions and exemptions.
Interest income, rental income, capital gains, etc.
Old Regime Deductions
These tax deductions only apply to reduce taxable income under the Old Tax Regime. They are ignored under the New Regime.
EPF, PPF, LIC, ELSS, School Fees, Principal Home Loan repayment (Max ₹1.5 Lakhs).
Health insurance premium paid for self, family and parents.
House Rent Allowance (HRA), Interest on Home Loan (Sec 24b), NPS, etc.
Tax Recommendation
Choose the New Regime.It saves you ₹1,11,800 in taxes!
| Tax Parameters | New Regime (FY 25-26) | Old Regime |
|---|---|---|
| Gross Income | ₹12,50,000 | ₹12,50,000 |
| Standard Deduction | - ₹75,000 | - ₹50,000 |
| Exemptions & Deductions | - ₹0 | - ₹2,25,000 |
| Net Taxable Income | ₹11,75,000 | ₹9,75,000 |
| Tax Before Rebate | ₹57,500 | ₹1,07,500 |
| Tax Rebate (Sec 87A) | - ₹57,500 | - ₹0 |
| Cess (4%) | ₹0 | ₹4,300 |
| Total Tax Payable | ₹0 | ₹1,11,800 |
New Regime Slabs: Up to 4L: Nil | 4-8L: 5% | 8-12L: 10% | 12-16L: 15% | 16-20L: 20% | 20-24L: 25% | Above 24L: 30%. Surcharge applies for income exceeding ₹50 Lakhs.
Standard Deductions: ₹75,000 (New regime) and ₹50,000 (Old regime) are automatically deducted from Gross Salary in the calculation.
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How to use Income Tax Calculator
- Enter Annual Gross Salary: Adjust the gross salary slider to match your annual package (CTC) before deductions.
- Add Exemptions & Deductions: If comparing with the Old Regime, specify your annual investments under Section 80C (up to ₹1.5 Lakhs), Section 80D (health insurance), and other deductions (HRA, interest on housing loan, etc.).
- Analyze Side-by-Side Comparison: The calculator automatically computes the net tax, cess, and rebates for both regimes and flags the one that saves you more money.
What is the Income Tax Calculator?
An Income Tax Calculator is an online tool designed to estimate your annual tax liabilities based on your salary structure, other source income, and eligible tax saving instruments. For the fiscal year 2025-26, it is particularly critical as it allows salaried individuals to decide whether they should opt for the simplified New Tax Regime or retain the investment-based Old Tax Regime.
Income Tax Slabs for FY 2025-26 (AY 2026-27)
Under the Union Budget, the tax slabs for the New Tax Regime have been simplified to encourage adoption, while the Old Tax Regime remains unchanged:
| Income Slab (New Regime) | Tax Rate | Income Slab (Old Regime) | Tax Rate |
|---|---|---|---|
| ₹0 - ₹4,00,000 | Nil | ₹0 - ₹2,50,000 | Nil |
| ₹4,00,001 - ₹8,00,000 | 5% | ₹2,50,001 - ₹5,00,000 | 5% |
| ₹8,00,001 - ₹12,00,000 | 10% | ₹5,00,001 - ₹10,00,000 | 20% |
| ₹12,00,001 - ₹16,00,000 | 15% | Above ₹10,00,000 | 30% |
| ₹16,00,001 - ₹20,00,000 | 20% | ||
| ₹20,00,001 - ₹24,00,000 | 25% | ||
| Above ₹24,00,000 | 30% | - | - |
Example of Income Tax Calculation
Let's calculate the tax for a gross annual income of ₹10,00,000 under both regimes:
- New Tax Regime: Standard deduction of ₹75,000 applies, leaving a taxable income of ₹9,25,000. Under slab rates: ₹0 - ₹4,00,000 is 0%; ₹4,00,001 - ₹8,00,000 is 5% (₹20,000); ₹8,00,001 - ₹9,25,000 is 10% (₹12,500). Total tax is ₹32,500 + 4% cess = ₹33,800.
- Old Tax Regime: Assuming standard deduction of ₹50,000 and Section 80C deduction of ₹1,50,000, leaving a taxable income of ₹8,00,000. Under slab rates: ₹0 - ₹2,50,000 is 0%; ₹2,50,001 - ₹5,00,000 is 5% (₹12,500); ₹5,00,001 - ₹8,00,000 is 20% (₹60,000). Total tax is ₹72,500 + 4% cess = ₹75,400.
- Result: In this scenario, the New Regime saves you ₹41,600.
Key Benefits of the New Tax Regime
- Higher Standard Deduction: Standard deduction increased to ₹75,000 for salaried employees and pensioners.
- Zero Tax up to ₹12 Lakhs: Thanks to Section 87A rebate adjustments, individuals earning up to ₹12 Lakhs per annum effectively pay nil income tax under the New Regime.
- No Investment Lock-ins: Taxpayers do not need to lock their capital in long-term products like PPF, ELSS, or insurance policies simply to save tax.
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Frequently Asked Questions
What is the New Tax Regime for FY 2025-26?
In the New Tax Regime for FY 2025-26 (AY 2026-27), slabs are widened. Tax rates start at 5% above ₹4,00,000 and peak at 30% above ₹24,00,000. It is the default tax regime. Standard deduction is increased to ₹75,000. Under Section 87A, rebate is structured so that individuals with taxable income up to ₹12,00,000 effectively pay zero tax.
Can I still choose the Old Tax Regime?
Yes, taxpayers can choose to opt-in to the Old Tax Regime at the time of filing their income tax returns. The Old Regime is beneficial if you make substantial investments under Section 80C, pay medical insurance under 80D, claim house rent allowance (HRA), or pay interest on a home loan.
How does the Section 87A rebate work in the New Regime?
Under the New Tax Regime, if your taxable income (Gross minus standard deduction) is less than or equal to ₹12,00,000, you are eligible for a tax rebate up to ₹60,000 under section 87A, bringing your net tax liability to ₹0.
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