Indian Income Tax Calculator 2024 - Compare Old vs New Tax Regime

Income Tax Calculator India 2025 - Compare Old vs New Tax Regime

₹
Important Notes for FY 2025-26:
  • New Tax Regime is the default regime from FY 2025-26
  • Standard Deduction: ₹75,000 in new regime, ₹50,000 in old regime
  • Tax rebate u/s 87A: Up to ₹60,000 for income up to ₹12L (new regime) / ₹12,500 for income up to ₹5L (old regime)
  • New regime has 7 slabs with rates from 0% to 30%
  • Old regime has 6 slabs (0%, 5%, 10%, 15%, 20%, 30%)
  • Section 80D combined limit: ₹1,00,000 (including parents)
  • Surcharge rates:
    • 10% for income above ₹50L up to ₹1Cr
    • 15% for income above ₹1Cr up to ₹2Cr
    • 25% for income above ₹2Cr up to ₹5Cr
    • 37% for income above ₹5Cr
    (with marginal relief)
  • Health & Education Cess: 4% on income tax + surcharge

Understanding Income Tax in India: A Comprehensive Guide

Income Tax in India: An Overview

Income tax is a direct tax levied by the Government of India on the income earned by individuals and entities in a financial year. The tax is collected by the Central Government and is one of the primary sources of revenue for the country. The Indian income tax system is progressive, meaning that the tax rate increases as the taxable income increases.

Tax Regimes in India: Old vs New

In the Union Budget 2020, the Government of India introduced a new tax regime as an alternative to the existing tax regime. Taxpayers now have the option to choose between the old tax regime (with deductions and exemptions) and the new tax regime (with lower tax rates but without most deductions).

Old Tax Regime

The old tax regime allows taxpayers to claim various deductions and exemptions under different sections of the Income Tax Act, such as:

  • Section 80C: Deductions for investments in specified instruments (limit: ₹1.5 lakh)
  • Section 80D: Deductions for health insurance premiums (limit: ₹25,000 for self and family, additional ₹25,000 for parents)
  • HRA (House Rent Allowance): Exemption for rent paid
  • LTA (Leave Travel Allowance): Exemption for travel expenses
  • Standard Deduction: ₹50,000 for salaried individuals

New Tax Regime

The new tax regime offers lower tax rates but does not allow most deductions and exemptions. This regime is beneficial for taxpayers who don't have significant deductions to claim. The new regime has the following tax slabs for FY 2025-26:

  • Up to ₹3 lakh: Nil
  • ₹3 lakh to ₹6 lakh: 5%
  • ₹6 lakh to ₹9 lakh: 10%
  • ₹9 lakh to ₹12 lakh: 15%
  • ₹12 lakh to ₹15 lakh: 20%
  • Above ₹15 lakh: 30%

Key Changes in Income Tax for FY 2025-26

The Union Budget 2024 introduced several changes to the income tax system for the financial year 2025-26:

  • The new tax regime is now the default option for all taxpayers
  • Standard deduction of ₹75,000 has been introduced in the new tax regime
  • Tax rebate under Section 87A has been increased to ₹3 lakh in the new regime
  • Tax rates have been adjusted to provide relief to middle-income taxpayers
  • Surcharge rates have been revised for high-income earners

How to Choose Between Old and New Tax Regime

Choosing between the old and new tax regimes depends on your individual financial situation. Here are some factors to consider:

  • Total Deductions Available: If you have significant deductions (more than ₹2-3 lakh), the old regime might be beneficial.
  • Income Level: For higher income levels, the new regime might offer better tax savings.
  • Investment Goals: If you prefer to invest in tax-saving instruments, the old regime provides incentives for such investments.
  • Simplicity: The new regime is simpler to understand and file, with fewer calculations involved.

Important Dates for Income Tax Filing

Being aware of important tax-related dates is crucial to avoid penalties:

  • Financial Year: April 1 to March 31
  • Assessment Year: The year following the financial year in which income is assessed
  • Due Date for Filing ITR: July 31 (for individuals not requiring audit)
  • Due Date for Filing ITR with Audit: October 31
  • Due Date for Filing Belated/Revised ITR: December 31

Tax Planning Tips for FY 2025-26

Effective tax planning can help you minimize your tax liability legally. Here are some tips:

  • Choose the Right Regime: Use our calculator to compare both regimes and choose the one that saves you more tax.
  • Maximize Deductions: If opting for the old regime, ensure you claim all eligible deductions.
  • Invest Early: Make tax-saving investments at the beginning of the financial year to benefit from compounding.
  • Keep Records: Maintain proper documentation for all your investments and expenses.
  • Consider Long-term Benefits: Choose investments that offer both tax benefits and long-term financial growth.

Use our income tax calculator to estimate your tax liability under both regimes and make an informed decision about which regime to choose for FY 2025-26.

Tax Summary

Gross Income: ₹0

Taxable Income: ₹0

Tax Amount: ₹0

Take Home: ₹0

Income Distribution
Regime Comparison
Old Regime Tax:₹0
New Regime Tax:₹0
Recommended Regime:New Regime (Save ₹0)