Income Tax Calculator

Old regime vs new regime — which one costs you less this year, FY 2026-27.

Your income & deductions

Deductions below only affect the old-regime column; the new regime allows just the standard deduction.

Annual total income (₹ / year, before deductions)

₹

Age group

80C investments (cap ₹1.5L)

₹

80D health insurance

₹

Home-loan interest 24(b) (cap ₹2L)

₹

HRA / other exemptions

₹

Your tax, both regimes

You pay—

Old regime tax —
New regime tax —
Recommended —
Effective tax rate —

Indicative estimate, FY 2026-27. New regime: standard deduction ₹75,000, tax nil if taxable income is up to ₹12,00,000 (§87A rebate up to ₹60,000). Old regime: standard deduction ₹50,000, chosen deductions, and §87A rebate up to ₹12,500 if taxable income is up to ₹5,00,000. Surcharge applies above ₹50L / ₹1cr / ₹2cr / ₹5cr (new regime caps surcharge at 25%) and 4% cess is added. Surcharge is shown without marginal relief.

How it works

How income tax is calculated in India

From FY 2026-27, India runs two parallel personal-tax systems and you may pick whichever is cheaper. The new regime has wider, lower slabs and a large §87A rebate that makes income up to ₹12,00,000 (after the ₹75,000 standard deduction) effectively tax-free, but it removes almost all deductions. The old regime keeps the familiar Section 80C, 80D, home-loan interest and HRA reliefs and a smaller ₹50,000 standard deduction, with a rebate that zeroes tax up to ₹5,00,000 of taxable income. In both systems, tax is computed slab by slab on your taxable income, a surcharge is added for high incomes (above ₹50 lakh and rising in steps), and a 4% health & education cess is applied on the total. This tool computes both columns from the same income and shows which regime leaves you paying less, along with the effective rate on your gross income. It skips marginal relief, so figures near a surcharge threshold are indicative.

FAQ

Income tax questions, answered

Which is better, the old or new tax regime?

It depends on how many deductions you claim. The new regime wins for most people with few deductions because income up to ₹12,00,000 is effectively tax-free; the old regime can win if you have large 80C, 80D, home-loan interest and HRA claims. This calculator computes both and tells you the cheaper one.

What is the Section 87A rebate?

The 87A rebate cancels your tax if taxable income stays within a limit. Under the new regime for FY 2026-27, tax is nil up to ₹12,00,000 of taxable income (a rebate of up to ₹60,000); under the old regime the limit is ₹5,00,000 (a rebate of up to ₹12,500).

What deductions can I claim under the new regime?

Almost none. The new regime allows the standard deduction of ₹75,000 for salaried people but removes 80C, 80D, home-loan interest, HRA and most other exemptions. Those reliefs are available only under the old regime, which is why the deduction inputs here affect the old-regime column only.

How are surcharge and cess applied?

A surcharge is added on the tax for high incomes: 10% above ₹50 lakh, 15% above ₹1 crore, 25% above ₹2 crore, and 37% above ₹5 crore under the old regime (the new regime caps surcharge at 25%). A 4% health and education cess is then added on tax plus surcharge.

Is this calculator exact?

It is a close indicative estimate using FY 2026-27 slabs, the standard deduction, the 87A rebate, surcharge and cess. It does not apply marginal relief, so figures just above a surcharge threshold may be slightly overstated. Confirm the final number with your payroll or tax adviser.

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