New tax regime slabs for FY 2025-26 (AY 2026-27)
The new regime is the default from FY 2023-24. Budget 2025 changed its slabs and raised the rebate so that income up to ₹12 lakh is tax-free (₹12.75 lakh for salaried people after the standard deduction).
| Taxable income | Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
- Standard deduction: ₹75,000 for salaried employees and pensioners.
- Section 87A rebate: up to ₹60,000, so tax is nil if taxable income is up to ₹12,00,000. Marginal relief applies just above ₹12 lakh, so your tax never exceeds the income above ₹12 lakh.
- Most deductions (80C, 80D, HRA, home-loan interest on self-occupied property) are not allowed. Employer NPS contribution under 80CCD(2) is allowed.
Old tax regime slabs
| Taxable income | Below 60 | 60–79 | 80+ |
|---|---|---|---|
| Up to ₹2,50,000 | Nil | Nil | Nil |
| ₹2,50,001 – ₹3,00,000 | 5% | Nil | Nil |
| ₹3,00,001 – ₹5,00,000 | 5% | 5% | Nil |
| ₹5,00,001 – ₹10,00,000 | 20% | 20% | 20% |
| Above ₹10,00,000 | 30% | 30% | 30% |
The old regime allows a ₹50,000 standard deduction and deductions such as 80C, 80D, HRA and home-loan interest. The 87A rebate of up to ₹12,500 makes income up to ₹5 lakh tax-free.
Surcharge and cess
A surcharge is added on tax for high incomes: 10% above ₹50 lakh, 15% above ₹1 crore, 25% above ₹2 crore, and 37% above ₹5 crore in the old regime (capped at 25% in the new regime). A 4% health and education cess is then added to tax plus surcharge.
Which regime should you choose?
As a rule of thumb, the new regime is better unless your deductions are large. At most income levels you need roughly ₹4–8 lakh of deductions (80C, HRA, home loan and so on) for the old regime to win. This calculator does the comparison for your exact numbers. Salaried employees can switch regime every year when filing; people with business income can switch back only once.
Frequently asked questions
Is income up to ₹12 lakh tax-free in FY 2025-26?
Yes, under the new regime, because of the Section 87A rebate of up to ₹60,000. For salaried people the limit is effectively ₹12.75 lakh after the ₹75,000 standard deduction. It doesn't apply to income taxed at special rates, like some capital gains.
What is the standard deduction for FY 2025-26?
₹75,000 in the new regime and ₹50,000 in the old regime, for salaried employees and pensioners.
Can I claim 80C in the new tax regime?
No. 80C, 80D, HRA and most other deductions are only available in the old regime. Employer NPS contribution under 80CCD(2) is allowed in both.
Which is better, the old or new tax regime?
For most people the new regime gives lower tax. The old regime can be better if you have large deductions such as HRA, a home loan and full 80C and 80D. Enter your numbers above to compare.