Income Tax Calculator India FY 2026-27 — Old vs New Regime

Last updated: 1 April 2026 Reviewed by CalcPhi Finance Team

The **income tax calculator for FY 2026-27** (AY 2027-28) computes your tax liability under both the old and new tax regimes simultaneously. Enter your gross income, salary components, and eligible deductions — the calculator returns the exact tax payable under each regime and flags which one saves you more money. **How the Section 87A rebate works in FY 2026-27:** Under the new tax regime, the Section 87A rebate cancels out all tax if your total income does not exceed ₹12,00,000. For salaried employees, the ₹75,000 standard deduction under the new regime means this zero-tax threshold effectively extends to a gross salary of ₹12,75,000. No deduction under the old regime can produce a lower tax bill than zero — so for any salaried person below this threshold, the new regime is always the right choice. **New regime tax slabs (FY 2026-27):** The new regime was upgraded in Budget 2025. The nil-rate threshold moved to ₹4 lakh, and the slab structure above it is: 5% on ₹4L–₹8L, 10% on ₹8L–₹12L, 15% on ₹12L–₹16L, 20% on ₹16L–₹20L, 25% on ₹20L–₹24L, and 30% above ₹24L. Despite these slab rates, most incomes below ₹12L pay zero tax after the 87A rebate. **Old regime tax slabs (FY 2026-27):** The old regime has higher rates — 5% on ₹2.5L–₹5L, 20% on ₹5L–₹10L, and 30% above ₹10L — but compensates with a full menu of deductions. The Section 87A rebate under the old regime applies if taxable income after all deductions falls below ₹5 lakh. The standard deduction is ₹50,000. **Key deductions under the old regime:** Section 80C covers EPF, PPF, ELSS, LIC premiums, and home loan principal repayment — capped at ₹1,50,000. Section 80D adds up to ₹25,000 for your own health insurance and ₹50,000 for senior citizen parents. HRA exemption covers a significant portion of rent paid in metro or non-metro cities. Section 24b deducts up to ₹2,00,000 in home loan interest on a self-occupied property. Section 80CCD(1B) gives an additional ₹50,000 exclusively for NPS Tier 1 contributions — over and above the 80C limit. A taxpayer with full utilisation of these deductions can reduce taxable income by ₹4.5–5 lakh or more, which is why the old regime continues to win for incomes above ₹17–18 lakh. **Surcharge for high incomes:** A surcharge applies on top of income tax for incomes above ₹50 lakh — 10% surcharge at ₹50L–₹1Cr, 15% at ₹1Cr–₹2Cr, 25% at ₹2Cr–₹5Cr, and 25% above ₹5Cr under the new regime (capped at 25% by Budget 2023 reduction). Health and education cess of 4% applies to all taxpayers regardless of regime. The calculator includes both surcharge and cess automatically. To compare how the two regimes affect your take-home salary, also use the [Old vs New Regime Calculator](/india/new-vs-old-regime-calculator/). For HRA-specific calculations, use the [HRA Calculator](/india/hra-calculator/). For NPS deduction modelling, use the [NPS Calculator](/india/nps-calculator/).

Annual Gross Income (₹) Total salary / income before any deductions

Section 80C Investments (₹) PPF, ELSS, LIC, EPF, tuition fees — max ₹1.5L

Health Insurance Premium (₹) Section 80D — self + family (max ₹25K) + parents (max ₹25K)

HRA Exemption (₹) Use HRA Calculator to compute this amount

Home Loan Interest (₹) Section 24b — max ₹2L for self-occupied property

NPS Contribution (₹) Section 80CCD(1B) — max ₹50,000 (extra over 80C)

Tax — New Regime —

Tax — Old Regime —

You Save —

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View Year-by-Year Breakdown

Real-World Examples — 2026

₹12 lakh annual income — old vs new regime (FY 2026-27)

Under the new regime, a ₹12 lakh income qualifies for the full Section 87A rebate — zero tax is payable. Under the old regime with ₹1.5 lakh in 80C deductions, taxable income is ₹10 lakhs and tax payable is approximately ₹1,12,500 plus cess. The new regime saves ₹1.17 lakhs at this income level with no deductions required.

₹20 lakh income — which regime saves more?

At ₹20 lakhs, the decision depends on deductions. Old regime with maximum 80C (₹1.5L), 80D (₹25K), HRA (₹2L), home loan interest (₹2L), and NPS (₹50K): total deductions ₹6.25 lakhs, taxable income ₹13.75 lakhs, tax ₹2.78 lakhs. New regime: standard deduction ₹75K only, taxable income ₹19.25 lakhs, tax ₹2.39 lakhs. New regime wins here.

Break-even deduction point — old vs new regime

The new regime is generally better when total deductions are below ₹3.75 lakhs at ₹15 lakh income. If your 80C, HRA, home loan interest, and 80D total more than ₹3.75–4 lakhs, the old regime may save more tax. Use this calculator to check your specific situation.

Income	New Regime Tax	Old Regime (with ₹4L deductions)
₹8 lakh	₹0 (rebate)	₹25,000
₹12 lakh	₹0 (rebate)	₹1,12,500
₹15 lakh	₹1,50,000	₹1,95,000
₹20 lakh	₹2,96,400	₹3,51,800
₹30 lakh	₹6,20,400	₹6,51,000

How to Use These Results

Which income tax regime is better in India in 2026?

The new regime is the default from FY 2023-24 and is now better for most salaried employees. If your total deductions (80C + HRA + home loan interest + 80D + NPS) exceed ₹3.75 lakhs at ₹15 lakh income, the old regime may save more tax. Use the calculator above to find your personal break-even point.

What is the Section 87A rebate under the new regime?

Under the new tax regime, individuals with annual income up to ₹12 lakhs (after standard deduction) are entitled to a full rebate under Section 87A — effectively paying zero income tax. This ₹12 lakh zero-tax limit (plus ₹75,000 standard deduction = ₹12.75 lakh gross salary) makes the new regime very attractive for salaries below ₹12 lakh.

Can you switch between old and new tax regimes each year?

Salaried individuals can switch between old and new tax regimes each financial year when filing their ITR. Self-employed individuals can switch only once — from old to new — and cannot switch back. Choosing the regime that saves more tax each year (with this calculator) is a legitimate and recommended strategy.

Income Tax Slabs FY 2026-27 (New Regime)

New tax regime slabs for FY 2026-27 (AY 2027-28)
Income Range	Tax Rate
Up to ₹4L	0%
₹4L – ₹8L	5%
₹8L – ₹12L	10%
₹12L – ₹16L	15%
₹16L – ₹20L	20%
₹20L – ₹24L	25%
₹24L – Above	30%

Rebate u/s 87A: Full rebate u/s 87A — zero tax for income up to ₹12 lakh. Standard deduction: ₹75,000.

Frequently Asked Questions

What are the income tax slabs for FY 2026-27 (new regime)?

New regime tax slabs for FY 2026-27: 0–₹4L: 0%; ₹4L–₹8L: 5%; ₹8L–₹12L: 10%; ₹12L–₹16L: 15%; ₹16L–₹20L: 20%; ₹20L–₹24L: 25%; above ₹24L: 30%. Additionally, income up to ₹12 lakh is fully exempt via the Section 87A rebate. A standard deduction of ₹75,000 applies.

What is the income tax limit for 2026-27 in India?

Under the new tax regime for FY 2026-27, income up to ₹12 lakh is effectively tax-free due to the Section 87A rebate. For salaried individuals, this extends to ₹12.75 lakh (including the ₹75,000 standard deduction) with zero tax payable.

How much income tax do I pay on ₹10 lakh income?

Under the new tax regime for FY 2026-27, ₹10 lakh income is below the ₹12 lakh rebate limit — tax payable is zero. Under the old regime with no deductions: taxable income ₹10L minus ₹50K standard deduction = ₹9.5L, tax = ₹1,12,500 + cess = ₹1,17,000. The new regime saves more here.

What deductions are allowed in the old tax regime?

The old tax regime allows: Section 80C (up to ₹1.5 lakh — EPF, PPF, ELSS, LIC, tuition fees); Section 80D (health insurance ₹25,000 + parents ₹25,000); HRA exemption; Section 24b home loan interest (up to ₹2 lakh); NPS 80CCD(1B) extra ₹50,000; LTA; Section 80TTA savings interest (₹10,000).

Is standard deduction available in the new tax regime?

Yes. A standard deduction of ₹75,000 is available to salaried employees under the new tax regime from FY 2024-25 onwards. This was increased from ₹50,000. No other deductions (80C, HRA, etc.) are applicable in the new regime.

What is the surcharge on income tax in India?

Surcharge applies on income above ₹50 lakh: ₹50L–₹1Cr: 10% surcharge on tax; ₹1Cr–₹2Cr: 15%; ₹2Cr–₹5Cr: 25%; above ₹5Cr: 37%. A health and education cess of 4% applies on (tax + surcharge) for all taxpayers.

What is the maximum total deduction I can claim under the old regime?

For a salaried employee under the old regime, the maximum commonly available deductions are: ₹50,000 standard deduction, ₹1,50,000 under 80C, ₹50,000 under 80CCD(1B) for NPS, ₹75,000 under 80D (self + senior citizen parents), ₹2,00,000 under Section 24b (home loan interest), plus HRA exemption which varies by salary and city. Excluding HRA, this totals ₹5,25,000. Adding a meaningful HRA exemption can push total deductions to ₹6–8 lakh for metro residents.

Do I need to declare my chosen tax regime to my employer?

Yes. At the start of each financial year, you need to inform your employer which regime you want to use for TDS calculation. If you do not declare, the employer deducts TDS under the new regime by default (since FY 2024-25). If you switch at ITR filing time, any difference is refunded or paid as a tax demand — but your monthly take-home salary is affected throughout the year, so it is better to declare upfront.

Is health insurance premium for parents deductible under the new tax regime?

No. Section 80D deductions — including health insurance premiums for yourself, your spouse, children, and parents — are not available under the new tax regime. All deductions under Chapter VI-A (which includes 80C, 80D, 80CCD(1B)) are disallowed under the new regime. Only the ₹75,000 standard deduction, the employer's NPS contribution (80CCD(2)), and a few specific exemptions like gratuity and leave encashment survive.

What is marginal relief on surcharge and how does it work?

Marginal relief prevents a situation where crossing a surcharge threshold results in paying more tax-plus-surcharge than the excess income. For example, if your income is ₹50.5 lakh (₹50,000 above the ₹50L threshold), the surcharge should not exceed ₹50,000. The calculator applies marginal relief automatically at each surcharge boundary. This relief is particularly relevant for incomes in the ₹50L–₹52L range.

How does Section 87A rebate work — is it deducted from income or from tax?

Section 87A is a rebate on tax, not a deduction from income. It is applied after computing your tax liability on the full income using the applicable slabs. Under the new regime for FY 2026-27: if your taxable income (after standard deduction) is ₹12 lakh or below, the computed tax is fully cancelled by the 87A rebate, making your final tax liability zero. If income exceeds ₹12 lakh by even ₹1, the rebate does not apply and the full slab-rate tax is payable.

What is the income tax on ₹15 lakh under the new regime after standard deduction?

Under the new tax regime for FY 2026-27: Gross salary ₹15,00,000 minus standard deduction ₹75,000 = taxable income ₹14,25,000. Tax on slabs: 0 on first ₹4L + ₹20,000 (5% on ₹4L–₹8L) + ₹40,000 (10% on ₹8L–₹12L) + ₹33,750 (15% on ₹12L–₹14.25L) = ₹93,750 base tax. Add 4% cess: total tax ₹97,500. No surcharge applies below ₹50L.