Tax Calculator — Income Tax Estimate

It depends on your deductions. If you actively claim HRA, Section 80C (Rs 1.5 lakh), 80D (health insurance), home loan interest, and NPS contributions, the old regime often results in lower tax. If you have few deductions, the new regime's lower slab rates and higher rebate threshold usually work out better. The simplest approach is to run the numbers through both regimes and pick whichever gives you a lower total tax.

Section 80C allows up to Rs 1.5 lakh in deductions per year across a range of investments and expenses: EPF contributions, PPF, ELSS mutual funds, 5-year tax-saver FDs, life insurance premiums, home loan principal repayment, children's tuition fees, Sukanya Samriddhi, and NSC. Most salaried employees already use a chunk of this through mandatory EPF deductions, so check what headroom you have left before investing specifically for 80C.

Under the new tax regime, if your total taxable income is up to Rs 7 lakh (after standard deduction), you get a full rebate — meaning zero tax. Under the old regime, the rebate applies for income up to Rs 5 lakh. The rebate effectively zeroes out the tax calculated on your income, but note that surcharge and cess may still apply in edge cases. It is one of the reasons the new regime suits people with moderate incomes and few deductions.