Income Tax Calculator India
Compare tax liability under the New Tax Regime vs Old Tax Regime with standard deductions, 80C/80D, and 87A rebate for current earnings.
Income & Deductions
Choosing the New Tax Regime saves you ₹1,32,600.00 in tax liability for the financial year.
Tax Computation Breakdown
| Component | New Regime | Old Regime |
|---|---|---|
| Gross Income | ₹12,75,000.00 | ₹12,75,000.00 |
| Standard Deduction | - ₹75,000.00 | - ₹50,000.00 |
| Chapter VI-A (80C, 80D, etc.) | N/A | - ₹1,75,000.00 |
| Taxable Income | ₹12,00,000.00 | ₹10,50,000.00 |
| Base Tax on Slabs | ₹60,000.00 | ₹1,27,500.00 |
| Section 87A Tax Rebate | - ₹60,000.00 | ₹0 |
| Health & Education Cess (4%) | ₹0.00 | ₹5,100.00 |
| Total Tax Payable | ₹0.00 | ₹1,32,600.00 |
- Resident individual below 60 years of age for current earnings (Tax Year 2026-27)
- Standard deduction of ₹75,000 for salaried individuals under New Regime (₹50,000 under Old Regime)
- Section 87A full rebate of up to ₹60,000 ensures zero tax liability up to ₹12 Lakh taxable income (₹12.75L gross for salaried) under New Regime
- Section 87A marginal relief applied for taxable income marginally above ₹12 Lakh
- Old Regime deductions include 80C (up to ₹1.5L), 80D (up to ₹50k), and Section 24(b) home loan interest (up to ₹2L)
- Health & Education Cess calculated at 4% on (Tax + Surcharge)
- For prior FY 2025-26 return filings, earlier Income-tax Act, 1961 provisions apply under AY 2026-27
Income Tax Regime Statutory Fact Triples (Tax Year 2026-27)
Statutory tax slabs, rebate limits, and marginal relief provisions for individual taxpayers.
- New Tax Regime Slab Thresholds
- Tax slabs under the default New Regime: Nil (up to ₹4,00,000), 5% (₹4,00,001–₹8,00,000), 10% (₹8,00,001–₹12,00,000), 15% (₹12,00,001–₹16,00,000), 20% (₹16,00,001–₹20,00,000), 25% (₹20,00,001–₹24,00,000), and 30% (above ₹24,00,000).
- Section 87A Tax Rebate Ceiling
- Resident individuals with taxable income not exceeding ₹12,00,000 are entitled to a full 100% tax rebate of up to ₹60,000 under the New Regime, resulting in net zero tax.
- Section 87A Marginal Tax Relief
- For taxable income slightly exceeding ₹12,00,000, income tax payable before 4% cess cannot exceed the incremental amount of income exceeding ₹12,00,000.
- Maximum Surcharge Cap under New Regime
- The highest surcharge rate under the New Tax Regime is capped at 25% for taxable income exceeding ₹2 Crore (compared to 37% under the Old Tax Regime), capping the maximum marginal tax rate at 39%.
Frequently Asked Questions
What is the difference between Old and New Tax Regime?
Old regime offers over 70 deductions and exemptions (80C, HRA, LTA, etc.) but has lower basic exemption (₹2.5L). New regime (default from FY 2023-24) has higher basic exemption (₹4L for FY 25-26), lower tax rates, but no deductions except standard deduction. Choose based on your total deductions.
What is Section 80C and what can I claim under it?
Section 80C allows deduction up to ₹1.5 lakh on investments in EPF, PPF, LIC premiums, ELSS mutual funds, NSC, home loan principal, tuition fees, and more. Available only in old tax regime. Reduces taxable income significantly for salaried individuals.
Do I need to file ITR if my income is below taxable limit?
Not mandatory if total income is below basic exemption limit. However, filing ITR is recommended for: claiming refunds, carrying forward losses, loan applications, visa processing, proof of income, and compliance with certain bank account thresholds (₹50L+ deposits).
What is advance tax and when do I need to pay it?
Advance tax is income tax paid in installments during the financial year if your tax liability exceeds ₹10,000. Payment dates: 15% by June 15, 45% by Sept 15, 75% by Dec 15, and 100% by March 15. Interest charged (234B, 234C) for delay or shortfall.
Can I change my tax regime every year?
Salaried individuals can switch between old and new regime every year while filing ITR. However, business/professional income earners can opt out of new regime only once, after which they're locked into old regime. Choose wisely based on your deductions and income pattern.
What happens if I don't file my ITR on time?
Late filing attracts penalty under Section 234F: ₹5,000 if filed before Dec 31, ₹10,000 thereafter (₹1,000 for income below ₹5L). You can't carry forward capital losses. Interest charged on unpaid tax. Prosecution possible for willful evasion. File before due date (July 31 for individuals).
How to Use This Calculator
- 1
Select your preferred tax regime: New Regime (higher exemption, no deductions) or Old Regime (lower exemption, multiple deductions).
- 2
Enter your gross annual income including salary, business income, interest income, and other sources.
- 3
If choosing Old Regime, enter deductions under 80C (up to ₹1.5L), 80D (health insurance), HRA, and other applicable sections.
- 4
Click Calculate Tax to see your taxable income, tax amount, 4% health & education cess, total tax payable, and effective tax rate.
Key Terms & Definitions
- Gross Total Income
- Total income from all sources including salary, house property, business/profession, capital gains, and other sources before any deductions.
- Taxable Income
- Income on which tax is calculated after subtracting all eligible deductions and exemptions from gross total income.
- Section 80C Deduction
- Tax deduction up to ₹1.5 lakh for investments in EPF, PPF, LIC, ELSS, NSC, home loan principal, tuition fees (only in old regime).
- Standard Deduction
- A flat deduction available to salaried individuals. ₹50,000 in new regime (default), ₹50,000 in old regime if opted.
- Health & Education Cess
- An additional 4% charge on calculated income tax, used for funding health and education schemes. Added to total tax payable.
- Effective Tax Rate
- The actual percentage of your gross income paid as tax (Total Tax / Gross Income × 100). Lower effective rate indicates better tax planning.
Formulas & Calculations
Taxable Income Calculation
Start with your total income from all sources, then subtract eligible deductions to arrive at taxable income. Only applicable in old regime. New regime doesn't allow most deductions.
Total Tax Payable
Calculate tax for each slab separately and add. Then add 4% cess. Example: ₹10L taxable (new regime FY 25-26) = ₹0 (0-4L) + ₹20K (4-8L @5%) + ₹20K (8-10L @10%) = ₹40K + ₹1.6K cess = ₹41.6K total.
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