Old vs New Tax Regime Calculator
Compare income tax liability under both regimes with updated slabs, Standard Deduction, Section 80C, 80D, HRA, and 87A rebates.
Income & Deduction Inputs
You save ₹25,480 in taxes under the New Regime.
New Regime
Old Regime
Complete Guide to Income Tax Regimes in India: Old vs. New Tax Slabs
Choosing between the Old and New Tax Regimes under the Indian Income Tax Act requires balancing tax slab rates against available tax-saving exemptions. Under the updated budget rules, the New Tax Regime offers lower tax rate tiers, a higher standard deduction of ₹75,000, and full tax exemption for incomes up to ₹7.75 Lakhs under Section 87A rebate.
New Tax Regime Slabs (FY 2024-25 / 2025-26)
- • ₹0 to ₹3,00,000: Nil (0%)
- • ₹3,00,001 to ₹7,00,000: 5%
- • ₹7,00,001 to ₹10,00,000: 10%
- • ₹10,00,001 to ₹12,00,000: 15%
- • ₹12,00,001 to ₹15,00,000: 20%
- • Above ₹15,00,000: 30%
Breakeven Deduction Benchmark
As a general financial rule of thumb, the Old Regime is beneficial only if your total eligible exemptions exceed the breakeven threshold:
- • Income ₹10 Lakhs: Old regime needs > ₹2.50 Lakhs deductions
- • Income ₹15 Lakhs: Old regime needs > ₹3.75 Lakhs deductions
- • Income ₹20 Lakhs: Old regime needs > ₹4.25 Lakhs deductions
Comparison: Old vs New Tax Regime Features
| Feature | New Tax Regime (Default) | Old Tax Regime (Optional) |
|---|---|---|
| Standard Deduction (Salaried) | ₹75,000 | ₹50,000 |
| Zero Tax Threshold (Sec 87A) | Up to ₹7.75 Lakhs | Up to ₹5.50 Lakhs |
| Section 80C Deductions | Not Allowed (₹0) | Allowed up to ₹1,50,000 |
| HRA / LTA / Section 24(b) | Not Allowed (₹0) | Allowed |
Frequently Asked Questions (FAQ)
How is zero tax calculated for income up to ₹7.75 Lakhs in the New Regime?
With a gross income of ₹7,75,000, deducting the ₹75,000 standard deduction brings taxable income to exactly ₹7,00,000. Under Section 87A, a full tax rebate of ₹25,000 is applied, resulting in ₹0 net tax liability.
Can I switch between the Old and New Tax Regimes every year?
Salaried individuals with no business income can switch between Old and New regimes every financial year while filing their ITR-1 or ITR-2. Individuals with business or professional income (ITR-3/ITR-4) can only switch once in a lifetime.
What is the Health and Education Cess rate?
A mandatory 4% Health and Education Cess is added to the total basic income tax payable after applying Section 87A rebate under both tax regimes.