📋 Income Tax Calculator

Income Tax Calculator – FY 2025-26

This calculator helps you estimate your income tax liability for Financial Year 2025-26 (Assessment Year 2026-27) under both the new tax regime (default) and the old tax regime. It includes the Section 87A rebate and 4% health and education cess.

New Tax Regime Slabs (FY 2025-26)

Under the new regime, a standard deduction of ₹75,000 applies, and income up to ₹12,00,000 (taxable income) is effectively tax-free due to the Section 87A rebate.

Old Tax Regime Slabs

Under the old regime, you get a ₹50,000 standard deduction and can claim deductions under 80C, 80D, HRA, etc.

Worked Example: New Regime

Suppose your annual income is ₹18,00,000 under the new regime for FY 2025-26:

Since taxable income here is above ₹12,00,000, the Section 87A rebate does not apply and tax is charged slab-wise as shown above.

Worked Example: Old Regime

For an income of ₹10,00,000 under the old regime (with only the standard ₹50,000 deduction and no other 80C/HRA claims):

Claiming deductions like 80C (₹1.5L) or HRA under the old regime would reduce this taxable income further, potentially lowering the tax below what the new regime charges — this is why comparing both regimes with your actual deduction amounts (using the calculator above) matters before choosing.

More Worked Examples Across Income Levels (New Regime)

Seeing how the same slabs play out at different income levels makes the Section 87A rebate and slab jumps easier to internalise. At an annual income of ₹7,00,000, taxable income after the ₹75,000 standard deduction is ₹6,25,000 — well within the ₹12,00,000 rebate threshold, so tax payable is nil. At ₹25,00,000, taxable income comes to ₹24,25,000, which pushes well past the rebate zone: tax works out to ₹3,07,500, and after 4% cess (₹12,300), the total liability is ₹3,19,800. At a higher income of ₹50,00,000, taxable income is ₹49,25,000, giving a base tax of ₹10,57,500 and cess of ₹42,300, for a total of approximately ₹10,99,800 — though note that incomes crossing ₹50 lakh also attract a surcharge (10% and higher in further slabs) on top of this figure, which this simplified calculator does not include, so very high earners should treat the result as an estimate before surcharge.

Common Deductions Still Available (Both Regimes)

A few deductions survive under both the old and new regimes, which is worth knowing regardless of which one you pick. The employer's contribution to NPS under Section 80CCD(2) remains deductible in both regimes, up to 10% of salary (14% for government employees). The standard deduction itself — ₹75,000 under the new regime and ₹50,000 under the old regime — applies automatically to salaried and pension income without any investment proof needed. Agricultural income, though not taxed directly, is still used to determine your tax slab under the "partial integration" method in both regimes. Everything else — 80C investments, HRA exemption, home loan interest under Section 24(b) for a self-occupied property, 80D health insurance premiums, and 80G donations — is available only under the old regime, which is precisely why taxpayers with significant investments, rent payments, or a home loan often still find the old regime cheaper despite its higher headline rates.

Who Should Use This Calculator

This calculator is built for salaried individuals, freelancers, and pensioners in India who want a quick estimate of their FY 2025-26 tax liability before finalising investment declarations or filing returns. It's especially useful in three situations: first, when choosing between the old and new regime at the start of the financial year, since your employer needs a declaration by April; second, mid-year when a bonus, increment, or freelance income changes your expected annual income and tax slab; and third, near March when you're deciding whether additional Section 80C, 80D, or NPS investments can still meaningfully reduce your tax. Note that this tool estimates liability under standard slabs and the Section 87A rebate — it does not account for capital gains, HRA exemption calculations, or other regime-specific deductions like 80D/80G, so for a full return-ready computation, cross-check with a CA or the official income tax e-filing portal.

Frequently Asked Questions

Q: Which tax regime is the default for FY 2025-26?
A: The new tax regime is the default for FY 2025-26 (Assessment Year 2026-27). If you want to opt for the old regime instead, salaried employees must inform their employer during the year, and individuals with business income must file Form 10-IEA before the due date of filing their return.

Q: What is the Section 87A rebate and who qualifies?
A: Under the new regime, taxpayers with taxable income up to ₹12,00,000 get a rebate that brings their tax liability to nil (plus a marginal relief zone slightly above this). Combined with the ₹75,000 standard deduction, this means gross salary income up to roughly ₹12.75 lakh can be effectively tax-free for salaried individuals under the new regime.

Q: Can I still claim 80C, HRA, and other deductions under the new regime?
A: Generally no — the new regime does not allow most common deductions like 80C (PPF/ELSS/life insurance), HRA exemption, or home loan interest under Section 24(b) for a self-occupied property. It does allow the standard deduction (₹75,000) and employer's NPS contribution under 80CCD(2). The old regime still allows the full range of deductions but uses higher tax rates.

Q: How is cess calculated on income tax?
A: A Health and Education Cess of 4% is added on top of your calculated income tax (after any rebate), under both regimes. For example, if your tax works out to ₹1,00,000, the cess adds ₹4,000, making your final liability ₹1,04,000.

Q: I have both salary and freelance income — which regime should I pick?
A: If your combined deductions under the old regime (80C up to ₹1.5 lakh, 80D health insurance, HRA, home loan interest, etc.) exceed roughly ₹4-5 lakh depending on your income level, the old regime often works out cheaper. Otherwise, given the wider slabs and 87A rebate up to ₹12 lakh, most taxpayers without large deductions find the new regime results in lower tax. Run both calculations with your actual numbers before deciding, since the crossover point varies by income level.

📅 Last reviewed: July 2026 · Formulas verified against RBI/SEBI/IT Dept guidelines.