India lets you pick between two ways of being taxed. The new regime offers lower slab rates and a generous rebate but strips away almost every deduction. The old regime keeps the familiar deductions — 80C, HRA, home-loan interest and more — but taxes income at higher rates. The right choice depends entirely on how much you can legitimately deduct.
Skip the theory. The kitna.tax calculator computes both regimes from your actual numbers and tells you which is cheaper. This page explains the why behind that answer.
The slab rates, side by side
These rates apply for both FY 2025-26 and FY 2026-27 — Budget 2026 left the slabs unchanged under both regimes.
New regime (uniform for all ages)
| Income slab | Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Standard deduction: ₹75,000 for salaried & pensioners. Section 87A rebate of up to ₹60,000 makes income up to ₹12 lakh tax-free (about ₹12.75 lakh of salary).
Old regime (below 60 years)
| Income slab | Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Standard deduction: ₹50,000 (salaried). Rebate up to ₹12,500 makes income up to ₹5 lakh tax-free. Senior citizens get higher basic exemptions — see the full tax slabs reference.
When the new regime wins
- You’re salaried with few investments or rent claims.
- Your total deductions are below the break-even points in the table below.
- You value simplicity — no proofs, no documentation, just the standard deduction.
- Your income is at or under ₹12 lakh (effectively ₹12.75 lakh salaried) — the rebate makes it tax-free either way, so the new regime is the obvious pick.
When the old regime wins
- You claim a large 80C (₹1.5L), NPS (₹50k), 80D, and full home-loan interest (₹2L).
- You pay significant rent and have a sizeable HRA exemption.
- Your combined deductions clear the break-even threshold for your income.
The break-even table
This is the most useful number in the whole debate: how much in total deductions (including the ₹50,000 standard deduction) you need before the old regime becomes cheaper than the new one. Figures are for a salaried individual below 60.
| Gross salary | New regime tax | Break-even deductions |
|---|---|---|
| ₹15,00,000 | ₹97,500 | ~ ₹5,94,000 |
| ₹20,00,000 | ₹1,92,400 | ~ ₹7,59,000 |
| ₹25,00,000 | ₹3,19,800 | ~ ₹8,50,000 |
| ₹30,00,000 | ₹4,75,800 | ~ ₹8,50,000 |
| ₹50,00,000 | ₹10,99,800 | ~ ₹8,50,000 |
In plain terms: unless you can deduct roughly ₹6–8.5 lakh a year, the new regime almost always costs less. Most taxpayers can’t reach that, which is why the new regime suits the majority.
Don’t guess — run your numbers
Enter your salary and deductions and see both regimes computed instantly, with the cheaper one flagged.
A worked example
Take a salaried individual earning ₹18 lakh with ₹1.5L under 80C, ₹50k NPS, ₹25k 80D and ₹2L home-loan interest — total deductions of about ₹4.75L (plus the standard deduction). Under the new regime the tax is roughly ₹1.5 lakh. Under the old regime, even with those healthy deductions, the higher 30% bracket bites and the tax lands higher — so the new regime still wins. They’d need closer to ₹7 lakh in deductions to flip it.
Can you switch regimes?
Salaried taxpayers can choose afresh every year when filing. Those with business or professional income face stricter rules and limited switching. The new regime is the default — to use the old one you must explicitly opt in.
FAQs
Is the new regime better than the old one? +
Which is the default regime? +
Do the slabs differ between FY 2025-26 and FY 2026-27? +
Next: see the complete income tax slabs for 2025-26 & 2026-27, or check how much tax you pay on your salary.