Old vs New Tax Regime
Your income tax for 2026-27 under both regimes, side by side, with the deductions the old regime allows.
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On these figures the new regime costs ₹1,11,800 less for the year.
- Tax under the new regime₹0
- Tax under the old regime₹1,11,800
- Taxable income, new regime₹11,25,000
- Taxable income, old regime₹9,75,000
How this is worked out
- Taxable income = income − standard deduction (new regime) or − standard deduction and the deductions you entered (old regime), each capped at its limit.
- Tax = the slab rates on taxable income − the rebate (if taxable income is within the limit) + 4% cess.
- New regime: no tax on taxable income up to 12 lakh, and just above it the tax is never more than the income above 12 lakh (marginal relief).
Assumptions
- A salaried resident below 60. Above 50 lakh of income a surcharge applies; this calculator stops at 50 lakh.
- Employer NPS, special-rate income such as capital gains, and deductions not listed here are left out.
- Rounded to the rupee. Your employer or a tax professional can confirm your exact figure.
Tax year 2026-27
Budget 2026 left the slabs, the rebate and the standard deduction unchanged for 2026-27.
In force from 1 April 2026 · checked by Savingy on 1 November 2026
The formula
Tax = slab tax on (income − deductions) − rebate, then + 4% cess
- New regime: standard deduction of 75,000 for salaried people; no tax on taxable income up to 12 lakh
- Old regime: standard deduction of 50,000 plus deductions such as tax-saving investments, health insurance and home loan interest
Just above 12 lakh of taxable income, the new regime never takes more tax than the income above 12 lakh (marginal relief).
A worked example
On a salary of ₹12,00,000 with ₹1,50,000 of tax-saving investments and ₹25,000 of health cover, the new regime comes to ₹0 and the old regime to ₹1,11,800 for 2026-27.
Questions people ask
Which tax regime is better for me in 2026-27?
It depends on your deductions. The new regime has lower rates and no tax up to 12 lakh of taxable income; the old regime lets you subtract tax-saving investments, health insurance, HRA and home loan interest. Enter your own figures above to see both totals.
Is income up to 12.75 lakh tax-free under the new regime?
For a salaried resident, yes: the 75,000 standard deduction brings 12.75 lakh of salary down to 12 lakh of taxable income, and the rebate then cancels the tax on it. Income taxed at special rates, such as some capital gains, is not covered by the rebate.
Can I switch between the old and new regime?
A salaried person can choose each year when filing the return. Someone with business income can switch back from the new regime only once. Your employer may ask which regime to use for monthly TDS; the choice when filing is what counts.
Does this calculator include surcharge?
No. Surcharge starts above 50 lakh of income, so the calculator stops at 50 lakh. Above that, or with capital gains or business income, check with a tax professional.
From the Savingy Guide
Related calculators
- HRA Exemption Calculator: Work out how much of your house rent allowance is tax-free under the old regime: the least of three limits, with the 2026-27 list of 50% cities.
- NPS Calculator: Your NPS pot at 60 from a monthly contribution, the lump sum you can take under the 2025 exit rules, and the monthly pension the annuity buys.
- PPF Calculator: Project your PPF balance year by year with annual contributions and the current interest rate. Plan tax-free, long-term savings.
Sources
Estimates are for illustration only and assume constant returns. Actual returns vary with market conditions. This is not investment advice.