Income tax calculator: new vs old regime
Compare the two personal tax regimes for FY 2026-27 (AY 2027-28) side by side: slab-wise tax, the section 87A rebate, surcharge, cess, monthly TDS, and which regime saves more at your deductions. Budget 2026 changed no slab, so the FY 2025-26 structure continues. Figures as of 1 November 2026.
Your income
Result
Adjust the figures and the comparison updates as you type.
How this is calculated
Both regimes start from the same gross: annual salary plus other income taxed at slab rates. Each regime then subtracts what it allows, applies its own slabs, its own section 87A rebate, surcharge, and the 4% health and education cess. Budget 2026 (1 February 2026) left every figure below as Budget 2025 had set it, so FY 2026-27 uses the FY 2025-26 structure. The Income-tax Act, 2025 replaces the 1961 Act from 1 April 2026 and renumbers sections without changing these amounts; the familiar 1961 section numbers are used here.
New regime (the default)
- Deductions: standard deduction of ₹75,000 on salary or pension, plus the employer's NPS contribution under 80CCD(2). HRA, LTA, 80C, 80D, 24(b) on a self-occupied house and 80CCD(1B) are not available.
- Slabs (all ages): nil up to ₹4L; 5% from ₹4L to ₹8L; 10% from ₹8L to ₹12L; 15% from ₹12L to ₹16L; 20% from ₹16L to ₹20L; 25% from ₹20L to ₹24L; 30% above ₹24L.
- Rebate u/s 87A: up to ₹60,000, which wipes out the tax on taxable income up to ₹12,00,000 (₹12,75,000 of salary after the standard deduction). Just above ₹12L, marginal relief caps the tax at the amount by which taxable income exceeds ₹12L, so a ₹12,10,000 taxable income pays ₹10,000 plus cess, not ₹61,500.
- Surcharge: 10% of tax above ₹50L of taxable income, 15% above ₹1 crore, 25% above ₹2 crore, and capped at 25% above ₹5 crore.
Old regime
- Deductions and exemptions: standard deduction ₹50,000; 80C up to ₹1,50,000; 80D up to ₹1,00,000 in total (₹25,000 for self and family, ₹50,000 if a senior citizen, plus the same for parents); HRA exemption as computed under section 10(13A); home-loan interest under 24(b) up to ₹2,00,000 for a self-occupied house; NPS under 80CCD(1B) up to ₹50,000; LTA for the actual fare; and whatever else you enter (80E, 80G, 80TTA, professional tax). Caps are applied before the figures are used.
- Slabs by age: basic exemption ₹2,50,000 below 60, ₹3,00,000 from 60 to 79, ₹5,00,000 at 80 or above; then 5% up to ₹5L (where applicable), 20% from ₹5L to ₹10L, and 30% above ₹10L.
- Rebate u/s 87A: up to ₹12,500 when taxable income is ₹5,00,000 or less, so no tax up to ₹5L. There is no marginal relief in the old regime; at ₹5,00,010 the full tax applies.
- Surcharge: 10% above ₹50L, 15% above ₹1 crore, 25% above ₹2 crore, 37% above ₹5 crore.
Common to both
- Marginal relief on surcharge: crossing a surcharge threshold can never cost more than the income above it. The calculator computes tax plus surcharge at the threshold, adds the excess income, and caps the surcharge there.
- Cess: 4% of tax after rebate plus surcharge.
- Effective rate is total tax divided by gross income. Monthly TDS is the annual total divided by twelve; real payroll spreads it over the months left in the year and adjusts for mid-year changes, so the first payslip of the year may differ.
- Break-even: when the new regime wins, the calculator searches for the smallest total of old-regime deductions at which the old regime would pay the same tax, so you can see how far your declarations are from making the switch worthwhile.
- Figures are shown to the rupee; the Act rounds final tax to the nearest ₹10 (section 288B), which can move the total by up to ₹5.
The regime an employee picks changes their TDS from month one, which is why ZekoHR records the choice with the investment declaration and computes each employee under their own regime. Read what HR and payroll must actually do when employees choose a regime, or see how TDS works inside payroll. Related tools: HRA exemption, gratuity, leave encashment.
Sources checked on 1 November 2026: Business Today, "Tax slabs FY 2026-27: what Budget 2026 changed for individual taxpayers" (1 February 2026); ClearTax, "Income tax slabs FY 2025-26 and FY 2026-27"; Tax2win and BankBazaar on the section 87A rebate and surcharge rates.
Common questions
Did Budget 2026 change the income tax slabs for FY 2026-27?
No. The Finance Minister kept the slabs under both regimes, the ₹60,000 section 87A rebate, the ₹75,000 standard deduction, surcharge and cess unchanged for FY 2026-27, so the structure Budget 2025 introduced for FY 2025-26 continues. The new Income-tax Act, 2025 applies from 1 April 2026 but renumbers sections rather than changing these figures.
Is salary up to ₹12.75 lakh really tax-free under the new regime?
For a resident salaried individual with no special-rate income, yes. ₹12,75,000 of salary less the ₹75,000 standard deduction leaves taxable income of ₹12,00,000, on which the slab tax is exactly ₹60,000, and the section 87A rebate of up to ₹60,000 cancels it. Capital gains taxed at special rates do not get the rebate, and the rebate is not available to non-residents.
What happens if my taxable income is just above ₹12 lakh?
Marginal relief applies in the new regime. Your tax before cess is capped at the amount by which taxable income exceeds ₹12,00,000, so at ₹12,20,000 you pay ₹20,000 plus 4% cess rather than the ₹63,000 the slabs would otherwise produce. The relief runs out at about ₹12,75,000 of taxable income, where the slab tax and the excess income meet.
Which deductions can I still claim under the new regime?
Mainly the ₹75,000 standard deduction on salary or pension and the employer's contribution to NPS under section 80CCD(2). HRA, LTA, 80C investments, 80D premiums, interest on a self-occupied home loan under 24(b) and your own NPS contribution under 80CCD(1B) are only available under the old regime, which is why the comparison depends so much on what you actually declare.
Can I switch between regimes every year?
Salaried individuals without business income can choose either regime each year when filing the return, and tell their employer which one to use for TDS at the start of the year. Someone with business or professional income who opts out of the new regime can return to it only once. Your employer's choice only affects monthly TDS; the final election is made in the return.
Why does the monthly TDS here differ from my payslip?
This page divides the annual tax by twelve. Payroll projects the year's income from what has been paid and what is expected, spreads the remaining tax over the months left, and recomputes after increments, joiners, bonuses and the proofs you submit in January. A mid-year change can make one month's deduction noticeably larger or smaller than the average.