Home › Old vs new tax regime
AY 2026-27 · previous year 2025-26
Old regime or new regime?
The new regime has wider slabs and a larger standard deduction. The old regime lets you deduct. Which one costs less is arithmetic on your own figures, and the answer changes with every rupee you claim.
The slab rates for AY 2026-27
The new regime slabs were widened by the Finance Act 2025. The old regime is unchanged.
New regime — Section 115BAC
| Total income | Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 to ₹8,00,000 | 5% |
| ₹8,00,001 to ₹12,00,000 | 10% |
| ₹12,00,001 to ₹16,00,000 | 15% |
| ₹16,00,001 to ₹20,00,000 | 20% |
| ₹20,00,001 to ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Same slabs whatever your age — the new regime has no separate schedule for senior citizens.
Old regime — below 60
| Total income | Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 to ₹5,00,000 | 5% |
| ₹5,00,001 to ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
The basic exemption rises to ₹3,00,000 for a resident aged 60 to 80, and to ₹5,00,000 above 80.
Surcharge applies above ₹50,00,000 at 10%, above ₹1 crore at 15%, above ₹2 crore at 25% and above ₹5 crore at 37% — capped at 25% under the new regime — with marginal relief at every threshold. Cess is 4% on tax plus surcharge in both regimes.
Work it out on your own figures
Salary and the deductions you actually claim. The calculator applies the AY 2026-27 slabs, the standard deduction for each regime, rebate u/s 87A and 4% cess.
The calculator needs JavaScript. The worked example below shows the same arithmetic.
What each regime lets you keep
| Deduction or exemption | Old regime | New regime |
|---|---|---|
| Standard deduction on salary | ₹50,000 | ₹75,000 |
| 80C — provident fund, life insurance, principal on a home loan, ELSS | Up to ₹1,50,000 | Not available |
| 80CCD(1B) — additional NPS contribution | Up to ₹50,000 | Not available |
| 80CCD(2) — employer’s NPS contribution | Up to 10% of salary | Up to 14% of salary |
| 80D — health insurance | ₹25,000, or ₹50,000 for a senior citizen | Not available |
| 80TTA / 80TTB — interest on deposits | ₹10,000 / ₹50,000 | Not available |
| House rent allowance u/s 10(13A) | Exempt on the prescribed computation | Not available |
| Interest on a self-occupied house property | Up to ₹2,00,000 | Not available |
| Interest on a let-out property | Allowed, set-off capped at ₹2,00,000 | Allowed against that property’s income |
| Family pension u/s 57(iia) | ₹15,000 | ₹25,000 |
| Rebate u/s 87A | ₹12,500, where total income is up to ₹5,00,000 | ₹60,000, where total income is up to ₹12,00,000 |
A worked example
A salary of ₹18,00,000, with ₹1,50,000 under 80C, ₹50,000 under 80CCD(1B) and ₹25,000 of health insurance under 80D.
Old regime. Standard deduction ₹50,000 and Chapter VI-A ₹2,25,000 bring total income to ₹15,25,000. Tax is ₹12,500 on the slab to ₹5 lakh, ₹1,00,000 on the slab to ₹10 lakh and ₹1,57,500 at 30% on the balance — ₹2,70,000, plus 4% cess of ₹10,800. ₹2,80,800.
New regime. Standard deduction ₹75,000 brings total income to ₹17,25,000, and nothing else is deductible. Tax across the widened slabs is ₹1,45,000, plus 4% cess of ₹5,800. ₹1,50,800.
On these figures the new regime costs ₹1,30,000 less. Add a home loan with ₹2,00,000 of interest on a self-occupied property and the gap narrows sharply — which is the whole point of computing both rather than choosing by reputation.
Illustrative. The salary and deductions are invented; the tax on them is the AY 2026-27 computation.
Questions
Which regime is the default?
Can I change regime every year?
What deductions survive under the new regime?
At what income does the new regime stop being better?
Is income up to ₹12 lakh really tax-free?
Both regimes, on every return
BharatTax does not ask you to choose a regime up front. It computes the return twice and shows you what each one costs, with the deductions that apply to each.