Gross Annual Salary
₹12,00,000
Before deductions
Total Income
₹12,00,000
Including other income
Total Deductions (Old)
₹3,97,400
80C: ₹1,50,000
You Save by choosing
₹75,941
✅ New Regime (100.0% less)
Tax Liability Comparison
New Regime saves you ₹75,941 annually
That's ₹6,328 saved per month! 💰
New Tax Regime
You save ₹75,941 (100.0%) with this regime
Why New Regime is better for you:
- Lower tax rates and higher exemption limit (₹4 lakh vs ₹2.5 lakh)
- Zero tax up to ₹12 lakh income with Section 87A rebate
- You don't have enough deductions to benefit from old regime
- Higher take-home salary with less paperwork and documentation
Old Regime Slabs
₹0 - ₹2.5L
₹2,50,000
₹0
₹2.5L - ₹5L
₹2,50,000
₹12,500
₹5L - ₹10L
₹3,02,600
₹60,520
New Regime Slabs
₹0 - ₹4L
₹4,00,000
₹0
₹4L - ₹8L
₹4,00,000
₹20,000
₹8L - ₹12L
₹3,22,600
₹32,260
Old Tax Regime
+ Rebate of ₹12,500 under Section 87A if income ≤ ₹5 lakh
New Tax Regime (FY 2025-26)
+ Rebate of ₹60,000 under Section 87A if taxable income ≤ ₹12 lakh (Zero tax!)
Additional charges: Surcharge applicable for income above ₹50 lakh (10%-37% based on income level) + Health & Education Cess at 4% on (Income Tax + Surcharge)
Old Tax Regime
- 70+ deductions and exemptions available
- HRA, LTA exemptions allowed
- Section 80C up to ₹1.5 lakh
- Section 80D health insurance benefits
- Home loan interest deduction (₹2L)
- Higher tax rates
- Complex tax planning required
New Tax Regime
- Lower tax rates across slabs
- Higher exemption limit (₹4 lakh vs ₹2.5 lakh)
- Zero tax up to ₹12 lakh with 87A rebate
- Standard deduction ₹75,000 available
- Higher rebate (₹60,000 vs ₹12,500)
- No other deductions allowed
- No HRA, LTA exemptions
| Deduction / Exemption | Old Regime | New Regime |
|---|---|---|
| Standard Deduction (Salaried) | ₹50,000 | ₹75,000 |
| Section 80C (PPF, ELSS, LIC, EPF, NSC) | Up to ₹1.5L | Not Allowed |
| Section 80D (Health Insurance) | Up to ₹75K | Not Allowed |
| HRA Exemption | As per rules | Not Allowed |
| LTA (Leave Travel Allowance) | Actual expenses | Not Allowed |
| Home Loan Interest (Sec 24b) | Up to ₹2L | Not Allowed |
| NPS Employer Contribution (80CCD2) | Up to 14% | Up to 14% |
| NPS Self Contribution (80CCD1B) | Up to ₹50K | Not Allowed |
| Education Loan Interest (80E) | No Limit | Not Allowed |
| Donations to Charity (80G) | 50-100% | Not Allowed |
| Professional Tax | Full | Full |
✅ Choose NEW Regime If:
- Your gross income is up to ₹12 lakh (Zero tax with 87A rebate!)
- You have minimal tax-saving investments (less than ₹3-4 lakh deductions)
- You don't pay rent or can't claim HRA
- You prefer simpler tax filing without maintaining investment proofs
- You're early in your career with fewer financial commitments
✅ Choose OLD Regime If:
- You have ₹4+ lakh in total deductions (80C, 80D, HRA, etc.)
- You pay significant rent and can claim HRA exemption
- You have a home loan with interest of ₹1.5-2 lakh annually
- You invest heavily in PPF, ELSS, NPS, health insurance
- Your income is ₹15 lakh+ with family responsibilities
💡 Break-Even Point
A general rule of thumb: If your total deductions exceed ₹3.75-4 lakh (including HRA, 80C, 80D, home loan interest), the Old Regime may save you more tax. Use the calculator above with your actual numbers to find which is better for you!
💼 For Salaried Employees
You can switch between regimes every year. Use this flexibility to optimize taxes annually based on your investments.
🏢 For Business Owners
Once you choose New Regime, you cannot switch back (one-time option). Plan carefully before making this decision.
📊 Tax Planning Tip
Even in New Regime, maximize employer NPS contribution (80CCD2) - it's allowed in both regimes up to 14% of basic!
Important Notes:
- This calculator is based on FY 2025-26 (AY 2026-27) tax slabs and rules
- Tax calculations are based on information available as of October 2025
- Results are estimates and should not be considered as financial or legal advice
- Actual tax liability may vary based on your specific circumstances
- Consult a qualified Chartered Accountant or tax professional for personalized advice
- Salaried employees can switch between regimes annually
- Business/professional income: Once opted for new regime, cannot switch back
- Standard deduction of ₹75,000 is available in both regimes for salaried individuals (increased from ₹50,000)