The Income Tax Calculator for FY 2025-26 (AY 2026-27) is your definitive tool to navigate India's latest tax benefits. With the New Tax Regime now offering a massive ₹12 Lakh Zero Tax threshold (via Section 87A rebate), choosing the right regime is more critical than ever.
2025-26 Budget Highlights:
- Standard Deduction: Increased from ₹50,000 to ₹75,000 for salaried and pensioners in the New Regime.
- Tax Rebate: Fully tax-free income up to ₹12 Lakhs (taxable income) under the New Regime.
- Effective Tax-Free Salary: A salaried person earning up to ₹12.75 Lakhs pays NIL tax (₹12L + ₹75k std deduction).
- Surcharge Cap: The highest surcharge rate remains capped at 25% for the highest income brackets.
How the Old vs New Tax Regimes Work
The calculator pits the high-deduction Old Regime against the low-rate New Regime to compute your exact effective tax outgo.
Taxable Income = Gross Income - Exemptions (HRA/LTA) - Deductions (80C/80D/Std. Ded)Where:
- • Standard Deduction: ₹50,000 (Old) vs ₹75,000 (New)
- • Section 87A Rebate: Making income up to ₹5L (Old) and ₹12L (New) tax-free.
- • Surcharge: Applies only on income above ₹50 Lakhs
- • Health & Education Cess: Flat 4% added to the final tax amount
- Old Tax Regime: Features higher tax slab rates, but allows you to claim ~70 different exemptions and deductions including HRA, LTA, Section 80C (₹1.5L), 80D (Health Insurance), and Home Loan Interest (₹2L). Best for high-earners with heavy mortgages and investments.
- New Tax Regime: Features significantly lower tax slab rates but completely abolishes almost all deductions. The only major deduction allowed is the ₹75,000 Standard Deduction for salaried/pensioners and Employer NPS contribution (80CCD2).
- Choosing the Regime: If your total deductions (80C + 80D + HRA + Home Loan) are less than ~₹3.75 Lakhs, the New Regime is mathematically guaranteed to save you more tax.
Example: The ₹15 Lakh Salary Dilemma
Karan earns a gross salary of ₹15,00,000. He claims standard deductions but does not have a home loan.
In the New Regime:
• Standard Deduction: ₹75,000
• Taxable Income: ₹14,25,000
• Tax Calculation based on simple slabs: ~₹1,05,000
In the Old Regime (Assuming he maxes 80C & 80D):
• Deductions: ₹50,000 (Std) + ₹1,50,000 (80C) + ₹25,000 (80D) = ₹2.25L
• Taxable Income: ₹12,75,000
• Tax Calculation based on expensive slabs: ~₹1,95,000
Result: Karan saves a massive ₹90,000 in pure cash by simply opting for the New Tax Regime without doing any extra tax planning!
Old vs New Regime FY 2025-26 Breakdown
A quick reference guide to deductions:
| Deduction / Feature | Available in Old Regime? | Available in New Regime? |
|---|---|---|
| Standard Deduction | Yes (₹50,000) | Yes (₹75,000) |
| 87A Zero Tax Rebate Limit | Up to ₹5 Lakhs | Up to ₹12 Lakhs |
| Section 80C (PPF, ELSS, EPF) | Yes (Up to ₹1.5L) | No |
| HRA & LTA Exemption | Yes | No |
| Home Loan Interest (Sec 24b) | Yes (Up to ₹2L) | No (except let-out property) |
| Employer NPS (80CCD2) | Yes (Up to 10%) | Yes (Up to 14%) |
Frequently Asked Questions
⚠️ Disclaimer
The figures provided by this calculator are estimates based on the inputs you provide and standard financial formulas. STOCKCALC.IN does not offer investment advice. Please consult a qualified financial advisor before making any investment decisions.