Income Tax Calculator

What This Tool Does

This calculator estimates your income tax liability for FY 2025-26 and FY 2026-27 under both the old and new tax regimes. Enter your salary, other income sources, and eligible deductions, and it shows your tax payable under each regime side by side — so you can pick whichever works in your favour without doing the math manually.

You can also use this Love Calculator.

How It’s Calculated

Income tax in India is calculated on your total taxable income after applying the applicable deductions and exemptions. The result is then matched against the slab rates for your chosen regime, and any applicable rebate, surcharge, or cess is added or subtracted to arrive at the final liability.

Basic formula:

Taxable Income = Gross Income − Standard Deduction − Other Eligible Deductions

Tax = Sum of slab-wise tax on taxable income + Surcharge (if applicable) + 4% Health and Education Cess − Rebate u/s 87A (if applicable)

Worked Example

Mr A earns ₹12.75 lakh as salary, with no other income. Under the new regime for FY 2026-27:

• Gross salary: ₹12,75,000
• Less standard deduction: ₹75,000
• Taxable income: ₹12,00,000

Tax calculation:

• Up to ₹4 lakh: Nil
• ₹4–8 lakh at 5%: ₹20,000
• ₹8–12 lakh at 10%: ₹40,000
• Total tax: ₹60,000
• Less rebate u/s 87A: ₹60,000
• Net tax payable: Nil

New Regime vs. Old Regime — Slab Rates for FY 2026-27

New Regime:

Old Regime:

Senior citizens (60–80 years) get a higher basic exemption of ₹3 lakh under the old regime. Super senior citizens (above 80) get ₹5 lakh before tax applies.

Key Deductions — Old Regime vs. New Regime

The new regime offers fewer deductions but more generous slab rates and a significantly higher rebate. The old regime makes sense primarily for those with substantial 80C investments, HRA claims, or home loan interest deductions.

Zero Tax Up to ₹12 Lakh — How It Works

Under the new regime, taxpayers with taxable income up to ₹12 lakh pay zero tax. This is not because the income is exempt — slab-wise tax still applies — but because a rebate under Section 87A cancels out the entire tax liability up to that threshold.

One important condition: the rebate applies only to income taxed at normal slab rates. Income from capital gains, online gaming, or other special-rate sources is not covered by this rebate, even if your total income is below ₹12 lakh.

Surcharge and Cess

A 4% Health and Education Cess applies to all taxpayers on their tax liability. Additionally, if taxable income crosses ₹50 lakh, a surcharge applies:

Which Regime Is Better for You?

The new regime works better for most salaried individuals who do not have large deductions. The old regime can be more beneficial if you have significant 80C investments, a home loan on a self-occupied property, HRA claims, or health insurance premiums that together exceed the advantage offered by the new regime’s lower slab rates.

A quick way to check: if your total eligible deductions under the old regime exceed roughly ₹3.75 lakh (for income around ₹15 lakh), the old regime may save you more. Use the calculator above to compare both numbers directly for your specific income and deduction profile.

Who Uses This

• Salaried employees deciding whether to submit a regime declaration to their employer at the start of the financial year
• Freelancers and self-employed individuals with mixed income sources wanting to estimate advance tax
• Senior and super senior citizens checking concessional slab benefits under the old regime
• HR and payroll professionals estimating TDS deductions for employees
• Anyone filing ITR who wants to confirm their tax liability before submission

FAQ

Is income up to ₹12 lakh completely tax-free under the new regime?

Yes, for income taxed at normal slab rates. The Section 87A rebate brings net tax to zero for taxable incomes up to ₹12 lakh. Special rate income like capital gains is excluded from this benefit.

Can I switch between old and new tax regimes every year?

Salaried individuals with no business income can switch regimes each year at the time of filing their ITR. Those with business income need to file Form 10-IEA and face restrictions on switching back.

What deductions are still available under the new regime?

The standard deduction of ₹75,000 on salary, employer’s NPS contribution under Section 80CCD(2), and home loan interest on let-out property are among the deductions available under the new regime.

Does this calculator account for TDS?

The calculator estimates your total tax liability for the year. TDS already deducted by your employer is a separate figure — subtract it from your calculated liability to find any remaining tax payable or refund due.

Which financial year does this calculator cover?

The calculator covers FY 2025-26 (AY 2026-27) and FY 2026-27 (AY 2027-28), reflecting the slab rates and rebate limits announced in the Union Budget 2026.

A Note on Results

This calculator provides estimates based on the inputs you enter and the provisions in effect for the relevant financial year. Actual tax liability may differ based on your specific income components, applicable exemptions, and assessment by the Income Tax Department. For filing purposes or complex income situations, consult a chartered accountant or tax professional.