Income Tax Calculator (New & Old Regime), FY 2025-26 & 2026-27

Income Tax Calculator for FY 2025-26 and FY 2026-27

This free income tax calculator works for both FY 2025-26 (AY 2026-27) and FY 2026-27 (AY 2027-28). It calculates your tax under the New Regime and the Old Regime at the same time, applies the correct standard deduction, Section 87A rebate, marginal relief, surcharge, and 4% cess, and tells you which regime saves you more money.

Everything runs inside your browser. Your salary and deduction details are never sent to any server, which makes this one of the safest ways to check your tax before filing.

What This Income Tax Calculator Does

An income tax calculator converts your annual income and deductions into your exact tax liability using the slab rates notified by the Income Tax Department. Instead of working through slabs, rebates, and cess by hand, you enter a few numbers and get the complete picture in seconds.

This calculator gives you:

• Tax payable under the New Regime and the Old Regime, side by side
• The regime that saves you more, with the exact savings amount
• Your net taxable income after all eligible deductions
• Section 87A rebate, applied automatically when you qualify
• Marginal relief for incomes just above ₹12 lakh in the New Regime
• Capital gains tax on equity at special rates (STCG at 20%, LTCG at 12.5%)
• Surcharge for high incomes and 4% Health and Education Cess
• Effective tax rate and your monthly tax outgo
• A full line-by-line calculation table you can verify yourself

You can also share your tax plan as a link, download the results as a CSV file, or export the summary as an image. These features are built into the calculator above.

Income Tax Slabs for FY 2025-26 and FY 2026-27

Budget 2025 introduced new slabs from FY 2025-26, and Budget 2026 kept them unchanged for FY 2026-27. So the same rates apply to both years.

New Tax Regime Slabs

The New Regime also gives salaried taxpayers a standard deduction of ₹75,000, higher than the ₹50,000 available under the Old Regime.

Old Tax Regime Slabs

The Old Regime keeps the higher basic exemption for senior and super senior citizens, which this calculator applies automatically based on your age group.

Zero Tax Up to ₹12.75 Lakh: How the 87A Rebate Works

This is the single biggest reason the New Regime wins for most salaried taxpayers now.

Under the New Regime, if your taxable income is ₹12 lakh or less, Section 87A gives you a rebate of up to ₹60,000, which wipes out your entire slab tax. Add the ₹75,000 standard deduction, and a salaried person earning up to ₹12,75,000 pays zero income tax.

Under the Old Regime, the rebate is much smaller. It is capped at ₹12,500 and only applies when taxable income stays within ₹5 lakh.

One important detail: the 87A rebate does not apply to capital gains taxed at special rates. If you have equity STCG or LTCG, that portion is taxed separately even when your salary income qualifies for the rebate. This calculator handles that correctly.

Marginal Relief Above ₹12 Lakh

What happens if your taxable income is ₹12,10,000? Without any protection, you would lose the full ₹60,000 rebate and owe around ₹61,500 in tax just because you crossed the line by ₹10,000.

Marginal relief fixes this. It caps your tax at the amount by which your income exceeds ₹12 lakh. So at ₹12,10,000, your tax is limited to ₹10,000 plus cess. The benefit tapers off and disappears around ₹12.75 lakh of taxable income, after which normal slab tax applies.

This calculator applies marginal relief automatically. Most free calculators skip it and overstate your tax. If your income sits between ₹12 lakh and ₹13 lakh, you can also verify the exact relief with our Marginal Relief Tax Calculator.

Old vs New Tax Regime: Which One Should You Pick?

The honest answer depends on one number: your total deductions.

A useful rule of thumb: if your total deductions beyond the standard deduction (80C, 80D, HRA, home loan interest, NPS) cross roughly ₹4.5 lakh to ₹5 lakh on a ₹15 lakh plus salary, the Old Regime starts becoming competitive. Below that, the New Regime almost always wins after Budget 2025.

You do not need to guess. Enter your actual numbers above and the calculator shows both regimes with the exact difference. For a deeper side-by-side breakdown, use our Old vs New Tax Regime Calculator.

How This Calculator Computes Your Tax, Step by Step

The calculator follows the same sequence the Income Tax Department uses:

1. Adds your gross salary and other income to get gross total income
2. Subtracts the standard deduction (₹75,000 new, ₹50,000 old)
3. Subtracts employer NPS under 80CCD(2), which is allowed in both regimes
4. In the Old Regime, subtracts 80C (capped at ₹1.5 lakh), 80D, HRA, home loan interest under 24b (capped at ₹2 lakh), NPS 80CCD(1B) (capped at ₹50,000), 80TTA/TTB, 80E, and 80G
5. Applies slab rates on the resulting taxable income
6. Applies the Section 87A rebate if you qualify
7. Applies marginal relief in the New Regime for income just above ₹12 lakh
8. Adds capital gains tax at special rates (equity STCG at 20%, equity LTCG at 12.5% above the ₹1.25 lakh annual exemption)
9. Adds surcharge if your income crosses ₹50 lakh
10. Adds 4% Health and Education Cess on tax plus surcharge

The full breakdown table below the calculator shows every one of these lines, so you can verify each figure instead of trusting a single output number.

Worked Example: Tax on ₹12 Lakh Salary

Take a salaried employee earning ₹12,00,000 a year in FY 2025-26, with ₹1,50,000 in 80C investments, ₹25,000 in health insurance under 80D, and ₹1,20,000 HRA exemption.

New Regime: Taxable income becomes ₹11,25,000 after the ₹75,000 standard deduction. Slab tax works out to about ₹58,750, but since taxable income is under ₹12 lakh, the 87A rebate cancels it fully. Tax payable: ₹0.

Old Regime: Deductions total ₹3,45,000 (standard deduction ₹50,000, 80C ₹1,50,000, 80D ₹25,000, HRA ₹1,20,000). Taxable income becomes ₹8,55,000. Slab tax comes to ₹83,500, plus 4% cess, for a total of about ₹86,840.

Result: the New Regime saves this person ₹86,840. Even with meaningful deductions, the rebate makes the New Regime unbeatable at this income level. Change any input above and watch the comparison update instantly.

Surcharge for High Incomes

If your total income crosses ₹50 lakh, a surcharge applies on top of your tax:

The New Regime caps surcharge at 25%, which is a significant saving for very high earners. The Old Regime still charges 37% above ₹5 crore. This calculator applies the correct rate for the regime you select.

Capital Gains in Your Tax Calculation

Most income tax calculators ignore capital gains. This one includes them, because equity investors need the complete picture.

• Short-term capital gains on equity (Section 111A) are taxed at a flat 20%
• Long-term capital gains on equity (Section 112A) are taxed at 12.5%, but only on gains above ₹1.25 lakh per year

These special rates apply in both regimes, and the 87A rebate does not reduce them. Enter your gains in the Capital Gains section of the calculator and they are added to your final liability correctly. For property, gold, and debt fund gains, use our dedicated Capital Gains Calculator.

Common Mistakes to Avoid

• Comparing regimes on slab rates alone. The 87A rebate and standard deduction change the outcome far more than the slabs themselves.
• Assuming zero tax means zero filing. You still need to file an ITR if your gross income exceeds the basic exemption limit, even when the rebate makes your tax nil.
• Forgetting that employer NPS under 80CCD(2) works in the New Regime too. It is one of the few deductions available in both, and many people leave it unclaimed.
• Applying the 87A rebate to capital gains. Special rate income is taxed separately.
• Ignoring marginal relief. If you earn just above ₹12 lakh, your real tax is far lower than a basic slab calculation suggests.
• Locking into a regime without checking yearly. Salaried taxpayers can switch every year, so run the comparison each April.

Expert Tips for Lowering Your Tax

• If you are near the ₹12.75 lakh salary mark, ask your employer about restructuring. Even a small shift into employer NPS under 80CCD(2) can bring you back into zero-tax territory.
• Old Regime loyalists should audit their deductions honestly. If 80C, HRA, and home loan interest together fall short of about ₹4.5 lakh, you are probably overpaying.
• Harvest equity LTCG up to ₹1.25 lakh every financial year. That exemption resets annually and unused portions do not carry forward.
• Check your Form 26AS and AIS before filing so your TDS credits match. Our TDS Calculator helps you estimate deductions through the year.
• If you have freelance or rental income on top of salary, estimate advance tax quarterly to avoid interest under Sections 234B and 234C.

Why Trust These Calculations

All slab rates, rebate limits, surcharge thresholds, and cess rates in this calculator follow the Income Tax Act as amended by the Finance Act 2025, with Budget 2026 confirming no slab changes for FY 2026-27. You can cross-check any result against the official tax calculator published by the Income Tax Department at incometaxindia.gov.in. The complete formula and every intermediate step are shown in the breakdown table, so nothing is hidden.

Key Takeaways

• The same slabs apply to FY 2025-26 and FY 2026-27, so one calculation covers both years
• Salaried taxpayers earning up to ₹12.75 lakh pay zero tax under the New Regime
• Marginal relief protects incomes just above ₹12 lakh, and this calculator applies it automatically
• The Old Regime only wins with roughly ₹4.5 lakh or more in total deductions
• Equity capital gains are taxed at special rates and never get the 87A rebate
• You can switch regimes every year as a salaried taxpayer, so compare before every filing

Last updated: 18 July 2026

Disclaimer: This calculator and content are for informational purposes only and do not constitute tax advice. Tax rules change with each Finance Act and individual situations vary. Consult a qualified chartered accountant or refer to the Income Tax Department before filing your return.

Frequently Asked Questions