Income Tax Calculator

Estimate tax payable under the old and new regimes (FY 2026-27 slabs).

Overview

Estimates annual tax liability and compares tax deductions under both the New Tax Regime (Section 115BAC) and Old Tax Regime for FY 2026-27.

Formula & Calculation Method

Tax Payable = Slab Rates(Taxable Income) - Section 87A Rebate + 4% Cess

Taxable income equals gross CTC minus permissible deductions (80C, 80D, HRA, Standard Deduction ₹75,000).

Worked Example: ₹12 Lakh Gross Salary under New Tax Regime

Inputs: Gross CTC = ₹12,00,000 | Standard Deduction = ₹75,000

  • Taxable salary = ₹12,00,000 - ₹75,00,000 = ₹11,25,000
  • Tax on ₹3L–₹7L (5%) = ₹20,000; ₹7L–₹10L (10%) = ₹30,000; ₹10L–₹11.25L (15%) = ₹18,750
  • Base tax = ₹68,750 + 4% Cess (₹2,750) = ₹71,500

Summary: Net Tax Payable under New Regime = ₹71,500 | Effective Tax Rate = 5.96%

Common Use Cases

  • Annual Tax Planning: Decide whether to opt for the Old or New Tax Regime before declaration deadlines.
  • Salary Structuring: Evaluate tax savings from employer NPS contributions under Section 80CCD(2).
  • Advance Tax: Estimate quarterly advance tax instalments to prevent Section 234B/234C interest penalties.

Frequently Asked Questions

Can salaried employees switch regimes every year?

Yes, salaried individuals can choose between Old and New regimes annually when filing their ITR.

What is the deduction threshold where Old Regime beats New Regime?

For incomes around ₹15 Lakhs, total eligible deductions must exceed roughly ₹3.75 Lakhs to beat the New Regime.

Is employer NPS tax-deductible in the New Regime?

Yes, employer contributions up to 14% of basic pay under Section 80CCD(2) are deductible in both regimes.

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