Income Tax Calculator: Old vs New Tax Regime Comparison (FY 2026-27 / AY 2027-28)
Filing income tax in India requires choosing between two fundamentally distinct tax regimes: the deduction-heavy Old Tax Regime and the lower-slab New Tax Regime (now the default regime under Section 115BAC). Choosing the wrong regime can cost salaried employees and professionals tens of thousands in extra taxes. Our free Income Tax calculator computes your exact tax liability, surcharge, 4% Health & Education Cess, and standard deductions under both systems side-by-side.
Income Tax Slabs & Rates Comparison (FY 2026-27)
| Income Slab | New Tax Regime (Default) | Old Tax Regime (Optional) |
|---|---|---|
| Up to ₹4,00,000 | Nil (0%) | Nil (0%) (Up to ₹2.5L) |
| ₹4,00,001 to ₹8,00,000 | 5% (Rebate u/s 87A up to ₹12L) | 5% (₹2.5L to ₹5.0L) |
| ₹8,00,001 to ₹12,00,000 | 10% | 20% (₹5.0L to ₹10.0L) |
| ₹12,00,001 to ₹16,00,000 | 15% | 30% (Above ₹10.0L) |
| ₹16,00,001 to ₹20,00,000 | 20% | 30% |
| ₹20,00,001 to ₹24,00,000 | 25% | 30% |
| Above ₹24,00,000 | 30% | 30% |
Key Deductions & Allowances: Old vs New Regime
| Deduction / Exemption | Old Tax Regime | New Tax Regime |
|---|---|---|
| Standard Deduction (Salaried) | ₹50,000 | ₹75,000 (Enhanced) |
| Section 80C (EPF, PPF, ELSS, LIC) | Up to ₹1,50,000 | Not Allowed |
| Section 80D (Health Insurance) | Up to ₹1,00,000 | Not Allowed |
| Section 24(b) (Home Loan Interest) | Up to ₹2,00,000 (Self-Occupied) | Not Allowed |
| HRA (House Rent Allowance) | Exempt (as per rules) | Not Allowed |
| Section 80CCD(2) (Employer NPS) | Allowed (up to 10%/14% of Basic) | Allowed (up to 14% of Basic) |
The Breakeven Threshold: When is Old Regime Better?
Because the 87A rebate now covers taxable income up to ₹12,00,000, the old regime only wins once your deductions get large. At a ₹10,00,000 salary the new regime charges nothing at all, so the old regime cannot beat it: it needs ₹4,50,000 of deductions just to also reach zero. Higher up, these are the points where the two regimes cost the same:
- On a ₹15,00,000 salary, the old regime wins only if your deductions (80C, 80D, HRA and home loan interest combined) come to more than ₹5,43,750.
- On a ₹20,00,000 salary, that figure rises to ₹7,08,333.
- Our Old vs New Tax Regime guide works through the arithmetic behind these numbers.
Rebate under Section 87A: Zero Tax Limits
Under the New Tax Regime, resident individuals with taxable income up to ₹12,00,000 get a full rebate of up to ₹60,000 under Section 87A, which wipes out the tax entirely. Add the ₹75,000 standard deduction and a salaried person earning up to ₹12,75,000 pays no income tax. Just above that line, marginal relief caps the tax at the amount by which your taxable income exceeds ₹12,00,000, so crossing the threshold never costs you more than you earned above it.
Practical Case Study: Tax Payable on ₹12,00,000 Salary
Take a salaried employee earning ₹12,00,000 a year who claims ₹1.5L under 80C, ₹25,000 under 80D, and an HRA exemption of ₹1.2L:
- Under Old Tax Regime:
- Gross Salary: ₹12,00,000
- Standard Deduction: -₹50,000
- HRA Exemption: -₹1,20,000
- Section 80C + 80D: -₹1,75,000
- Net Taxable Income: ₹8,55,000
- Base Tax: ₹12,500 (5% on 2.5L-5L) + ₹71,000 (20% on 3.55L) = ₹83,500
- Total Tax with 4% Cess: ₹86,840
- Under New Tax Regime:
- Gross Salary: ₹12,00,000
- Standard Deduction: -₹75,000
- Net Taxable Income: ₹11,25,000
- Base Tax: ₹20,000 (5% on 4L) + ₹32,500 (10% on 3.25L) = ₹52,500
- Less Section 87A rebate (taxable income under ₹12L): -₹52,500
- Total Tax: ₹0
- Even with ₹2.95 Lakhs of deductions, the New Regime costs ₹86,840 less here, because the 87A rebate removes the tax altogether. On this salary the Old Regime cannot come out ahead at all: it needs ₹6,50,000 of deductions just to also reach nil tax.
Important Tax Filing Deadlines & Penalties (2026)
- July 31st: Annual deadline for individual salaried taxpayers and non-audit business professionals to file ITR-1 or ITR-2.
- Belated Filing (Section 234F): Late fee of ₹5,000 (₹1,000 if total income ≤ ₹5 Lakhs) applies for filings completed between August 1st and December 31st.
- Interest on Delayed Tax (Section 234A): 1% penal interest per month charged on outstanding unpaid tax liabilities until actual filing date.