Income Tax Slabs India FY 2025-26 (AY 2026-27) - New & Old Regime

1. New Tax Regime Slabs (FY 2025-26)

The new regime is the default tax regime from FY 2023-24 onwards. It offers lower rates but fewer deductions. Standard deduction of ₹75,000 is available.

Income Slab	Tax 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%

        Key Benefit: Under Section 87A, individuals with taxable income up to ₹12,00,000 (after standard deduction) pay zero tax effectively. This means salaried individuals earning up to ₹12,75,000 pay no income tax under the new regime.
      

2. Old Tax Regime Slabs (FY 2025-26)

The old regime allows deductions under Sections 80C, 80D, HRA, home loan interest, and more. Standard deduction of ₹50,000 is available.

Income Slab	Tax Rate
Up to ₹2,50,000	Nil
₹2,50,001 - ₹5,00,000	5%
₹5,00,001 - ₹10,00,000	20%
Above ₹10,00,000	30%

Senior Citizens (60-80 years): Basic exemption limit is ₹3,00,000.
Super Senior Citizens (80+ years): Basic exemption limit is ₹5,00,000.

3. Surcharge Rates

Surcharge is levied on the income tax amount (not on income) when taxable income exceeds ₹50 lakh.

Taxable Income	Surcharge Rate
₹50,00,001 - ₹1,00,00,000	10%
₹1,00,00,001 - ₹2,00,00,000	15%
₹2,00,00,001 - ₹5,00,00,000	25%
Above ₹5,00,00,000	37%

        New Regime Cap: Under the new regime, the maximum surcharge is capped at 25% (the 37% slab does not apply). This makes the new regime more beneficial for very high earners (above ₹5 crore).
      

Health & Education Cess: 4% is charged on (Tax + Surcharge) for all taxpayers under both regimes.

4. Section 87A Rebate

Section 87A provides a rebate that effectively makes income up to a certain limit tax-free:

Regime	Rebate Limit (Taxable Income)	Maximum Rebate
New Regime	Up to ₹12,00,000	₹60,000
Old Regime	Up to ₹5,00,000	₹12,500

Under the new regime, if your total taxable income (after standard deduction) is ₹12 lakh or less, you get a full rebate and pay zero tax. For salaried individuals, this translates to gross income of approximately ₹12.75 lakh being tax-free.

5. Which Regime Should You Choose?

The right choice depends on your deductions and exemptions. Here is a quick comparison:

Choose New Regime If

You have minimal deductions (below ₹3-4 lakh)
You do not have HRA or home loan benefits
You want simplicity with no paperwork for exemptions
Your income is under ₹12.75 lakh (effectively zero tax)
Your income is above ₹5 crore (25% surcharge cap)

Choose Old Regime If

You claim 80C (₹1.5L) + 80D + HRA + home loan
Total deductions exceed ₹3.75 to ₹4 lakh
You have HRA exceeding ₹1 lakh per year
You pay home loan interest (Section 24b: up to ₹2L)
You are a senior citizen with higher exemption limits

        Rule of Thumb: If your total deductions (80C + 80D + HRA + home loan interest + NPS) exceed ₹3.75 lakh, the old regime will likely save you more tax. Otherwise, the new regime wins.
      

6. Quick Tax Calculation Examples

Below are estimated tax liabilities for three common income levels (salaried individuals, no other deductions assumed for new regime):

Gross Income: ₹10,00,000 per annum

New Regime: ₹0 (covered by 87A rebate) Old Regime: ₹54,600 (assuming ₹1.5L u/s 80C only)

Gross Income: ₹15,00,000 per annum

New Regime: ₹1,04,000 (approx.) Old Regime: ₹1,87,200 (assuming ₹2L deductions)

Gross Income: ₹20,00,000 per annum

New Regime: ₹2,91,200 (approx.) Old Regime: ₹3,43,200 (assuming ₹3L deductions)

Note: Figures include 4% cess. Actual tax may vary based on specific deductions claimed. Use our calculator for precise results.

Income Tax Slabs India FY 2025-26