New vs Old regime: what is the difference?
Salaried individuals in India can pay tax under two regimes. The New regime (the default) has lower slab rates and a higher standard deduction of ₹75,000, but allows very few deductions. The Old regime has higher rates but lets you claim 80C, 80D, HRA, home-loan interest and other deductions, with a standard deduction of ₹50,000.
Tax slabs for FY 2026-27
| New regime slab | Rate |
|---|---|
| Up to ₹4 Lakh | Nil |
| ₹4 Lakh – ₹8 Lakh | 5% |
| ₹8 Lakh – ₹12 Lakh | 10% |
| ₹12 Lakh – ₹16 Lakh | 15% |
| ₹16 Lakh – ₹20 Lakh | 20% |
| ₹20 Lakh – ₹24 Lakh | 25% |
| Above ₹24 Lakh | 30% |
| Old regime slab (below 60) | Rate |
|---|---|
| Up to ₹2.5 Lakh | Nil |
| ₹2.5 Lakh – ₹5 Lakh | 5% |
| ₹5 Lakh – ₹10 Lakh | 20% |
| Above ₹10 Lakh | 30% |
- Rebate u/s 87A: New regime taxable income up to ₹12 Lakh pays no tax (rebate up to ₹60,000); Old regime up to ₹5 Lakh.
- Cess: 4% on tax plus surcharge. Surcharge applies above ₹50 Lakh of income.
Union Budget 2026 kept the slabs, rebate, surcharge and cess unchanged.
Worked example: ₹15 lakh salary
Worked example
Same salary, different regimes
- New regime tax
- ₹97,500
- Old regime, no deductions
- ₹2,57,400
- Old regime, with 80C, 80D, NPS and home-loan interest
- ₹1,24,800
Even with all of these deductions the New regime is still cheaper here. The Old regime wins only when deductions are larger still — for example when an HRA exemption is added.
Enter your deductions in the calculator's Old regime section and it shows both totals, the better regime and your saving.

