Income Tax Calculator FY 2025-26 – Old vs New Regime Comparison

The most significant change in Union Budget 2025 is the enhancement of the Section 87A rebate under the New Tax Regime from Rs.25,000 to Rs.60,000. This makes income up to Rs.12 lakh completely tax-free. For salaried employees, the standard deduction of Rs.75,000 means those earning up to Rs.12.75 lakh pay zero income tax under the new regime.

It depends entirely on your deductions. The New Regime is better for income up to Rs.12L, for those with fewer deductions, or for high incomes above Rs.20L. The Old Regime is better when you have high combined deductions — full 80C (Rs.1.5L) + HRA + Home Loan interest (Rs.2L) + NPS. Use this calculator to check your exact scenario.

Section 87A is a direct rebate that reduces your tax to zero if you qualify. Under the New Regime, the rebate is Rs.60,000 for taxable income up to Rs.12 lakh. Under the Old Regime, it is Rs.12,500 for income up to Rs.5 lakh. Only resident individuals can claim this rebate — NRIs are not eligible.

Yes. From FY 2023-24 onwards, the New Tax Regime is the default for all taxpayers. To claim deductions under the Old Regime, you must inform your employer at the start of the financial year, or file Form 10-IEA before the ITR due date if you have business income.

The New Tax Regime allows: Standard Deduction of Rs.75,000 for salaried/pensioners, Employer NPS under Sec 80CCD(2) up to 10% of salary (14% for govt employees), and Agniveer Corpus Fund under Sec 80CCH. All other deductions including 80C, 80D, HRA, and Home Loan interest are NOT available.

Marginal relief prevents someone earning slightly above Rs.12 lakh from paying more tax than the extra income earned. At Rs.12.5 lakh, the excess above Rs.12L is Rs.50,000 — so tax is capped at Rs.50,000 instead of Rs.65,000. This calculator automatically applies marginal relief wherever applicable.

Yes, but only under the Old Tax Regime. Senior Citizens (60-79 years) get a basic exemption of Rs.3,00,000. Super Senior Citizens (80+ years) get Rs.5,00,000 and skip the 5% slab entirely. Under the New Tax Regime, the same slabs apply to all ages.

31st July 2026 for salaried individuals and non-audit cases. 31st October 2026 for businesses requiring tax audit. Late filing attracts a fee of up to Rs.5,000 under Section 234F.

Salaried individuals can switch freely every year at the time of ITR filing. Business/Professional taxpayers can switch from New to Old Regime only once in a lifetime — after that, they are locked into the new regime permanently.