Old vs New Tax Regime — India FY 2026-27
Every budget season, one question: which regime leaves more money in your pocket? Enter your salary and deductions — the calculator applies the actual FY 2026-27 slabs, rebates and marginal relief to both regimes and declares a winner.
Your inputs
Deductions — old regime only
HRA exemption
Old regime — slab breakup
| Slab | Rate | Taxable in slab | Tax |
|---|
New regime — slab breakup
| Slab | Rate | Taxable in slab | Tax |
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Two regimes, one choice
India taxes salaried income under two parallel systems. The new regime (the default) offers lower slab rates and a generous rebate, but strips away almost all deductions — no 80C, no 80D, no HRA. The old regime keeps higher rates but lets you subtract 80C investments, health insurance, HRA and NPS. Neither is "better" — it depends on your deductions.
The math behind this calculator
New regime: taxable = gross − ₹75,000 standard deduction. Slabs: nil to ₹4L, 5% on ₹4–8L, 10% on ₹8–12L, 15% on ₹12–16L, 20% on ₹16–20L, 25% on ₹20–24L, 30% above ₹24L. Taxable income ≤ ₹12L gets the 87A rebate (up to ₹60,000) wiping tax to zero; just above ₹12L, marginal relief caps tax at the excess over ₹12L. Then 4% cess.
Old regime: taxable = gross − ₹50,000 standard deduction − 80C (cap ₹1.5L) − 80D (cap ₹25k here) − HRA exemption − NPS 80CCD(1B) (cap ₹50k). Slabs: nil to ₹2.5L, 5% on ₹2.5–5L, 20% on ₹5–10L, 30% above ₹10L; 87A rebate (up to ₹12,500) zeroes tax if taxable ≤ ₹5L. Then 4% cess.
New regime: tax = slab tax − 87A rebate (≤ ₹12L) or marginal relief (> ₹12L), + 4% cess
Worked example
Take a ₹20 lakh salary with ₹1.5L in 80C, ₹25k health premium, and an HRA exemption of ₹3.6L (₹9L basic, ₹4.8L annual rent, metro city). Old regime: taxable = ₹14.15L → slab tax ₹2,37,000 + cess ₹9,480 = ₹2,46,480. New regime: taxable = ₹19.25L → slab tax ₹1,85,000 + cess ₹7,400 = ₹1,92,400. The new regime wins by ₹54,080 — the lower slabs beat the deductions here. But crank the rent and 80C higher and the old regime claws back: that's exactly the trade-off to test above.
Which regime suits whom?
As a rough rule: if your total deductions (80C + 80D + HRA + NPS, excluding standard deduction) cross about ₹4 lakh, the old regime is usually competitive — HRA in a metro is the biggest lever, since ₹30–40k monthly rent converts into lakhs of exemption. Below that, the new regime's lower rates and the ₹12L rebate almost always win, with none of the paperwork. Salaried taxpayers can switch regimes every year, so re-run this whenever your pay, rent or investments change.
Caveats worth knowing
- Budget 2026 changed nothing. Slabs, rebate limits and deduction caps are identical to FY 2025-26 — only the law's section numbers moved (the new regime is now Section 202 of the Income-tax Act, 2025, previously 115BAC).
- Surcharge ignored. Above ₹50L of income a surcharge (10–37%) applies; this calculator skips it, so very high earners should treat results as approximate.
- 80D capped at ₹25k here. Premiums for senior-citizen parents allow up to ₹50k — if that applies to you, the old regime is slightly better than shown.
- Salary only. Capital gains, rental income and business income have their own rules and aren't modelled here.
Sources: FinCalculator — New Regime FY 2026-27 (Budget 2026: no slab changes); Ganak — Complete Guide to Income Tax FY 2026-27; Calculious — India Income Tax 2026-27.