💼 Indian Personal Finance Tool

Income Tax Planner

Compare side-by-side tax liability under the Old vs New Tax Regimes in India.

Enter Income & Exemptions

Income Details
₹12,00,000
₹
Old Regime Deductions
₹1,50,000
₹
₹50,000
₹
₹25,000
₹

Tax Planner Summary

👉 Save ₹39,000 by choosing the New Regime!
New Tax Regime Liability: ₹78,000
Old Tax Regime Liability: ₹1,17,000

Indian Income Tax Regimes: Old vs New

To provide personal taxpayers in India with greater flexibility, the Government of India introduced the **New Tax Regime** in Budget 2020, running parallel to the existing **Old Tax Regime**. While the Old Tax Regime operates on higher tax percentage slabs but allows taxpayers to slash liabilities using deductions (under Sec 80C, 80D, HRA, and Home Loan interest), the New Regime offers much lower base tax slabs but blocks almost all standard deductibles.

Old vs New Standard Tax Slabs Comparison

For FY 2025-26 / AY 2026-27, the standard tax slabs are organized as:

New Tax Regime Slabs (Zero Deductions except Standard Deduction of ₹75,000):
• Up to ₹3 Lakh: Nil (0%)
• ₹3 Lakh to ₹7 Lakh: 5% (Tax rebate makes income up to ₹7 Lakh effectively tax-free under Sec 87A)
• ₹7 Lakh to ₹10 Lakh: 10%
• ₹10 Lakh to ₹12 Lakh: 15%
• ₹12 Lakh to ₹15 Lakh: 20%
• Above ₹15 Lakh: 30%

Old Tax Regime Slabs (Fully Customizable with 80C, 80D, HRA, and ₹50,000 Standard Deduction):
• Up to ₹2.5 Lakh: Nil (0%)
• ₹2.5 Lakh to ₹5 Lakh: 5% (Tax rebate makes income up to ₹5 Lakh effectively tax-free)
• ₹5 Lakh to ₹10 Lakh: 20%
• Above ₹10 Lakh: 30%

How is Income Tax Computed?

• Net Taxable Income (Old) = Gross Annual Salary - ₹50,000 (Std Deduction) - Sec 80C - Sec 80D - HRA/Home Loan Interest.
• Net Taxable Income (New) = Gross Annual Salary - ₹75,000 (Std Deduction). No other deductions allowed.
• Final Tax Liability = Slabs Tax + 4% Health & Education Cess added on the final calculated tax amount.

Income Tax Planner FAQs

What is Standard Deduction in salaried income?
Standard deduction is a flat reduction in salaried income allowed by the Income Tax Department to cover general employment expenses. In the Old Regime, it stands at ₹50,000. In the New Regime, it has been enhanced to ₹75,000. It requires no expense bills or declarations to claim.
Which tax regime is better for general taxpayers?
If you live in rented accommodation, have home loan EMIs, and invest heavily in 80C tax-saving assets, the Old Tax Regime often results in lower tax liabilities. However, if you have low investment profiles and want simple, paperwork-free declarations with lower tax rates, the New Tax Regime is highly superior.
Can I switch between the Old and New Tax Regimes every year?
Salaried individuals who do not possess business income have the full flexibility to choose and switch between the Old vs New Tax Regimes every financial year at the time of filing their Income Tax Returns (ITR).