How to Calculate Income Tax under the New Regime (FY 2025-26)
Navigating the Indian income tax slabs can be complex. With the latest updates in the Union Budget, the New Tax Regime has become the default choice for many due to lower rates and a higher standard deduction. Our tool simplifies this process by calculating your tax liability in seconds.
New Tax Slab Rates for FY 2025-26 / AY 2026-27
| Income Slab (₹) | Tax Rate (%) |
|---|---|
| Up to 4,00,000 | 0% |
| 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% |
Key Benefits of the New Tax Regime:
- Increased Standard Deduction: Salaried employees now benefit from a ₹75,000 standard deduction.
- Zero Tax up to ₹12 Lakhs: Thanks to the Section 87A rebate, if your taxable income is $\le$ ₹12,00,000, you pay no tax.
- Effective Tax-Free Income: For salaried individuals, gross income up to ₹12,75,000 is effectively tax-free (₹12,00,000 taxable income + ₹75,000 Standard Deduction).
- Simplified Structure: Fewer deductions to track, making tax filing faster and easier.
Frequently Asked Questions (FAQ)
What is the standard deduction in the new regime for 2025-26?
The standard deduction for salaried individuals under the New Tax Regime for FY
2025-26 remains at ₹75,000.
Is the New Tax Regime better than the Old Regime?
The New Tax Regime offers lower tax rates but removes most exemptions (like HRA or
80C). It is generally better for those who do not have high investments or home loans.
How is the 4% Cess calculated?
The Health and Education Cess of 4% is calculated on the total amount of your base
income tax.
Disclaimer: This tool is for estimation purposes only. Tax laws can change. Please consult with a qualified Chartered Accountant (CA) or visit the official Income Tax Department website for official tax filing and legal advice.