Free Income Tax Calculator
Compare old vs new tax regime side by side for FY 2025-26.
NEW REGIME
OLD REGIME
New Tax Regime Slabs FY 2025-26
The new tax regime is the default option since FY 2023-24. Budget 2025 raised the effective tax-free income to ₹12,00,000 via a Section 87A rebate.
| Annual Income Slab | Tax Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Standard deduction: ₹75,000. Section 87A rebate makes income up to ₹12,00,000 effectively tax-free (₹12,75,000 including standard deduction for salaried employees).
Old Tax Regime Slabs
| Annual Income Slab | Tax Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
The old regime allows deductions: Section 80C (up to ₹1,50,000), 80D (health insurance), HRA exemption, home loan interest (Section 24), and standard deduction of ₹50,000.
Which Regime Is Better For You?
- New regime wins if: your total deductions (80C + HRA + home loan interest + 80D) are below approximately ₹4–4.5 lakh per year, or you don't have significant investments/rent
- Old regime wins if: you pay substantial rent (HRA exemption), have home loan interest, and max out 80C investments (₹1.5L) plus 80D health insurance
Frequently Asked Questions
Which tax regime is better, old or new?
It depends on your deductions. If your HRA, 80C, and home loan interest deductions total more than roughly 30–35% of your gross income, the old regime usually results in lower tax. Otherwise, the new regime's lower slab rates and ₹12L rebate typically win.
What is the tax on a 12 lakh salary?
Under the new regime (FY 2025-26), a ₹12,00,000 salary results in zero tax payable due to the Section 87A rebate, which makes income up to ₹12,00,000 effectively tax-free. Under the old regime, tax would depend heavily on deductions claimed.
What is the tax on a 20 lakh salary?
Under the new regime, a ₹20,00,000 salary (after ₹75,000 standard deduction) attracts approximately ₹2,90,000–3,00,000 in tax including cess. Under the old regime, the tax could be similar or higher unless significant deductions (80C, HRA, home loan) are claimed.
Can I switch between old and new tax regime every year?
Salaried individuals without business income can switch between regimes every financial year when filing their ITR. Those with business or professional income can switch only once — after opting out of the new regime, they cannot switch back except in specific circumstances.
Is the new tax regime automatically applied?
Yes. Since FY 2023-24, the new tax regime is the default. Employees must explicitly choose the old regime (usually at the start of the financial year via employer declaration, or while filing ITR) if they want to use it.
