Old vs New Tax Regime Calculator 2025-26

Compare old vs new tax regime for FY 2025-26. Enter salary and deductions to instantly see which tax regime saves you more money.

Example: ₹15L income with ₹2L deductions → Old regime may save more tax

Annual CTC / Gross Income (₹):

Standard Deduction (₹): New regime: ₹75,000 | Old regime: ₹50,000 (auto-adjusts)

HRA Exemption (₹): Only applicable in old regime

Section 80C (₹, max 1,50,000): Only applicable in old regime

Section 80D Health Insurance (₹, max 25,000): Only applicable in old regime

Home Loan Interest Section 24 (₹, max 2,00,000): Only applicable in old regime

NPS 80CCD(1B) (₹, max 50,000): Only applicable in old regime

Other Deductions (₹): Only applicable in old regime

Tax Comparison:

Old vs New Tax Regime 2025-26: Which One Should You Choose?

The Indian tax system offers two regimes for salaried individuals - the old regime with various deductions and the new simplified regime with lower tax rates but fewer deductions. Choosing the right one can significantly impact your tax liability.

Key Differences Between Old and New Tax Regime

Old Tax Regime:

Allows all deductions (80C, 80D, HRA, home loan interest, etc.)
Standard deduction: ₹50,000
Higher tax rates but lower taxable income due to deductions
Rebate u/s 87A: Tax = 0 if income ≤ ₹5,00,000

New Tax Regime (Default from FY 2023-24):

No deductions except standard deduction and employer's NPS contribution
Standard deduction: ₹75,000
Lower tax rates but higher taxable income
Rebate u/s 87A: Tax = 0 if income ≤ ₹12,00,000 (Budget 2025 update)

Who Benefits from Old Regime?

The old regime is better for you if:

You have significant deductions (₹2+ lakhs annually)
You pay home loan EMI (Section 24 interest deduction)
You invest heavily in 80C instruments (ELSS, PPF, insurance)
You have high HRA exemption
You have health insurance premiums (80D)

Who Benefits from New Regime?

The new regime is better for you if:

You have minimal or no deductions
Your income is up to ₹12 lakhs (effectively tax-free)
You don't have home loan or significant investments
You prefer simplicity over tax planning

Budget 2025 Changes

The Union Budget 2025 made the new tax regime the default for all taxpayers. Key changes include:

Rebate u/s 87A increased to ₹12 lakhs (from ₹7 lakhs)
This means income up to ₹12 lakhs is effectively tax-free in new regime
Standard deduction increased to ₹75,000 in new regime

Decision Framework

To decide which regime is better:

Calculate your total deductions in old regime
Calculate taxable income in both regimes
Apply tax slabs to both
Compare final tax liability
Choose the one with lower tax

Use this calculator to make an informed decision based on your specific financial situation.

Important Points to Remember

You can switch regimes every year
Once chosen for a year, you cannot change mid-year
New regime is now default, but you can opt for old regime
Consider long-term financial goals when choosing
Review your choice annually as your income and deductions change

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Old regime vs new regime

India offers two ways to calculate income tax. The old regime has higher tax rates but lets you claim many deductions and exemptions (such as 80C, HRA and home-loan interest). The new regime has lower, simplified rates but removes most of those deductions. The best choice depends on how many deductions you actually claim.

How this tool helps

You enter your income and the deductions you're eligible for, and the comparator estimates your tax under each regime side by side so you can see which results in lower tax.

How to use it

Enter your total annual income.
Enter your eligible deductions (80C, HRA, etc.).
Calculate to compare the tax payable under both regimes.

Rule of thumb

If you claim large deductions, the old regime often wins.
If you claim few or no deductions, the new regime is usually simpler and cheaper.
The break-even point shifts as the government revises slabs and rebates.

Tax slabs, rebates and standard deductions change every financial year (Union Budget). Always verify against the latest Income Tax Department rules before filing your return.

Frequently Asked Questions

Which tax regime is better for me?

It depends on your deductions. The old regime suits those with large deductions; the new regime usually suits those with few. Compare both above.

Can I switch between regimes each year?

Salaried individuals without business income can generally choose afresh each year, but rules differ for those with business income. Check current rules.

Are slabs the same every year?

No. Tax slabs and rebates are revised in the Union Budget, so always confirm the latest figures before filing.

Does this tool store my data?

No. Everything runs entirely in your browser. Nothing you enter is uploaded, saved, or shared.