Income Tax Slabs FY 2025-26 (AY 2026-27) — New Regime
| Income Range | Tax Rate | Tax on Slab |
|---|
| Up to ₹4,00,000 | 0% | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% | ₹20,000 |
| ₹8,00,001 – ₹12,00,000 | 10% | ₹40,000 |
| ₹12,00,001 – ₹16,00,000 | 15% | ₹60,000 |
| ₹16,00,001 – ₹20,00,000 | 20% | ₹80,000 |
| ₹20,00,001 – ₹24,00,000 | 25% | ₹1,00,000 |
| Above ₹24,00,000 | 30% | 30% of amount above ₹24L |
Plus 4% Health and Education Cess on total income tax. Standard deduction of ₹75,000 applies. Section 87A rebate: income up to ₹12 lakh is effectively tax-free.
Income Tax Slabs FY 2025-26 — Old Regime
| Income Range | Tax Rate (Below 60 yrs) |
|---|
| Up to ₹2,50,000 | 0% |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Old Regime allows deductions under 80C (₹1.5L), 80D (health insurance), HRA, LTA, home loan interest (Section 24, ₹2L), NPS (80CCD), and more. These can significantly reduce taxable income.
New Regime vs Old Regime — Which is Better for You?
| Situation | Better Regime |
|---|
| Income below ₹12 lakh (no deductions needed) | New Regime (zero tax) |
| Income ₹12–20L with 80C + HRA + Home Loan | Compare both — Old may win |
| Income above ₹20L with maximum deductions | Old Regime likely better |
| No home loan, no HRA, limited 80C | New Regime almost always better |
| Business income (freelancers, self-employed) | New Regime (simpler compliance) |
Key Tax-Saving Deductions Under Old Regime
- Section 80C (₹1.5L): ELSS mutual funds, PPF, LIC, EPF, ULIP, NSC, school fees
- Section 80CCD(1B) (₹50,000): Additional NPS contribution — exclusive extra deduction
- Section 80D (₹25,000–₹1L): Health insurance premium for self and parents
- Section 24 (₹2L): Home loan interest for self-occupied property
- HRA: House Rent Allowance exemption if living in rented accommodation
- LTA: Leave Travel Allowance for domestic travel (twice in 4-year block)
Frequently Asked Questions
Is income up to ₹12 lakh really tax-free in 2025-26?
Yes, under the New Tax Regime for FY 2025-26: after ₹75,000 standard deduction, the net income is ₹11.25 lakh. The tax on this is ₹60,000, which is fully offset by the Section 87A rebate (₹60,000). So effective tax = ₹0. However, this only applies if your total income is ≤ ₹12 lakh — any income above ₹12 lakh attracts full tax from the first rupee of the applicable slab.
Can I switch between New and Old Regime every year?
Salaried individuals can switch between regimes every financial year when filing ITR. Business owners/freelancers can switch only once — from Old to New or back. For salaried employees, you can inform your employer which regime to use for TDS, and file ITR under a different regime if you choose.
What is surcharge in income tax?
Surcharge is an additional tax on income above ₹50 lakh: 10% surcharge for income ₹50L–₹1Cr, 15% for ₹1–2Cr, 25% for ₹2–5Cr, and 37% for above ₹5Cr (Old Regime). Under New Regime, max surcharge is 25%. Plus 4% cess applies on the total (tax + surcharge).
When is the ITR filing deadline?
For salaried individuals (no audit required): July 31 each year. For businesses requiring audit: October 31. Filing after the deadline attracts a late fee of ₹1,000–₹5,000 plus interest on any unpaid tax.
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CalcBharat.com Finance Team
Tax & Personal Finance Experts
Tax slabs and rules verified for FY 2025-26 (AY 2026-27) as per Budget 2025 announcements. Tax laws are complex — consult a CA for personalized advice. Last updated: April 2026.