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Open calculatorAssumptions and methodology
Transparent calculation notes for New Regime Income Tax Calculator.
Formula used
Salary or pension is reduced by the ₹75,000 standard deduction, and the taxable income is taxed through the new-regime slabs for the tax year.
Methodology
- Subtract the ₹75,000 standard deduction from salary or pension (not from business or other income).
- Allocate taxable income across the new-regime slabs.
- Apply the Section 156 rebate (up to ₹60,000 at taxable income ≤ ₹12 lakh) and marginal relief above ₹12 lakh; apply surcharge on taxable income with marginal relief; add 4% cess.
Core assumptions
- The calculator uses the Tax Year 2026-27 new-regime slabs under the Income-tax Act, 2025.
- The taxpayer is a resident individual, so the Section 156 rebate applies.
- Only deductions supported by the calculator are included.
- Income is treated as annual gross income before modeled deductions.
Not included
- Old-regime comparison, special-rate income, capital gains, TDS and non-resident status are not modeled.
- Tax rules can change by tax year and should be verified before filing.
About New Tax Regime Calculator
Guide1What is the New Tax Regime?
The New Tax Regime is an alternative income tax structure introduced by the Government of India in Budget 2020 and made the default regime from FY 2023-24. It offers lower tax rates across various income slabs but eliminates most deductions and exemptions available under the Old Regime.
The New Regime is designed to simplify tax filing and benefits individuals who do not have significant investments in tax-saving instruments or high HRA and home loan interest deductions.
2New Regime Tax Slabs (Tax Year 2026-27)
- Up to ₹4,00,000: Nil
- ₹4,00,001 to ₹8,00,000: 5%
- ₹8,00,001 to ₹12,00,000: 10%
- ₹12,00,001 to ₹16,00,000: 15%
- ₹16,00,001 to ₹20,00,000: 20%
- ₹20,00,001 to ₹24,00,000: 25%
- Above ₹24,00,000: 30%
The calculator applies the ₹75,000 standard deduction to salary or pension and models the Section 156 rebate and marginal relief for resident individuals: no tax on taxable income up to ₹12,00,000 (rebate up to ₹60,000), and just above ₹12 lakh the tax is limited to the income above ₹12 lakh. Surcharge above ₹50 lakh also gets marginal relief, and 4% cess is added. Special-rate income such as capital gains and filing-specific exceptions are not modeled.
3New Regime vs Old Regime
Key differences to consider:
- Deductions: The New Regime does not allow most deductions (80C, 80D, HRA, etc.) except standard deduction, NPS employer contribution, and a few others
- Lower Rates: Tax rates are lower in the New Regime, which benefits those with fewer deductions
- Simplicity: New Regime is simpler to file — no need to maintain proof of investments
- Break-even: With the current slabs the old regime wins only when your old-regime deductions and exemptions (Section 123/80C, HRA, home-loan interest, 80D and so on, apart from the ₹50,000 standard deduction) are large: about ₹5.4 lakh at ₹15 lakh salary, ₹6.4 lakh at ₹18 lakh, ₹7.1 lakh at ₹20 lakh, and about ₹8 lakh from ₹25 lakh to ₹50 lakh of salary. Above ₹50 lakh it varies, and just above the ₹50 lakh, ₹1 crore and ₹2 crore surcharge thresholds it can drop to ₹3–5 lakh. Up to ₹12.75 lakh of salary the new regime costs nothing, so the old regime cannot beat it.
4How to Use This Tax Calculator
- Step 1: Enter your gross annual income. Choose Salary or pension to apply the ₹75,000 standard deduction, or Business or other income for business, professional, freelance, rent or interest income, which gets no standard deduction. If you have both, choose Salary or pension if your salary or pension is at least ₹75,000. Capital gains taxed at special rates are not modeled.
- Step 2: The calculator applies the New Regime slabs, and the standard deduction for salary or pension, automatically
- Step 3: View your total tax, including the rebate or marginal relief, surcharge and cess
- Step 4: If you have large deductions, work out your old-regime deductions with the 80C Tax Saver and HRA calculators and compare them with the break-even above.