For FY 2025-26 (AY 2026-27) the new regime is the default. Slabs: up to ₹4L Nil; ₹4-8L 5%; ₹8-12L 10%; ₹12-16L 15%; ₹16-20L 20%; ₹20-24L 25%; above ₹24L 30%. The Section 87A rebate (up to ₹60,000) makes tax NIL up to ₹12,00,000 taxable income — and with the ₹75,000 standard deduction, a salaried person pays zero tax up to about ₹12.75 lakh. The old regime stays optional.
New Regime Slabs — FY 2026-27 (AY 2026-27)
These are the current slabs under the Income-tax Act, 2025, applicable from AY 2026-27. They apply to individuals, HUFs and most taxpayers who do not opt out to the old regime.
| Income Range | Rate | Tax on this Slab | Cumulative Tax |
|---|---|---|---|
| Up to ₹4,00,000 | Nil | ₹0 | ₹0 |
| ₹4,00,001 – ₹8,00,000 | 5% | ₹20,000 | ₹20,000 |
| ₹8,00,001 – ₹12,00,000 | 10% | ₹40,000 | ₹60,000 |
| ₹12,00,001 – ₹16,00,000 | 15% | ₹60,000 | ₹1,20,000 |
| ₹16,00,001 – ₹20,00,000 | 20% | ₹80,000 | ₹2,00,000 |
| ₹20,00,001 – ₹24,00,000 | 25% | ₹1,00,000 | ₹3,00,000 |
| Above ₹24,00,000 | 30% | — | — |
Add 4% Health & Education Cess on the tax. Standard deduction ₹75,000 for salaried/pensioners. Section 87A rebate up to ₹60,000 makes tax nil where taxable income ≤ ₹12,00,000.
The ₹60,000 rebate under the new regime applies to income taxed at slab rates. It does not apply to income taxed at special rates such as long-term capital gains under Section 112A. So even if total income is ₹12 lakh, LTCG on shares can still be taxable.
Zero Tax up to ₹12.75 Lakh — Salaried
This is why "no tax up to ₹12.75 lakh" is true only for a salaried person on the new regime: the ₹75,000 standard deduction brings a ₹12.75L salary down to ₹12L taxable, and the 87A rebate then wipes out the ₹60,000 tax.
Nil Salaried — ₹12.75L
Taxable Salaried — ₹16L
The 87A rebate is a cliff at ₹12,00,000 taxable income. Just above it, marginal relief ensures your extra tax cannot exceed the extra income over ₹12 lakh — so a taxable income of, say, ₹12.10L does not suddenly pay ₹61,500 tax.
Want your exact FY 2026-27 tax computed both ways?
Use the Income Tax Calculator →Old Regime Slabs — FY 2026-27
The old regime is unchanged and still optional. You keep Chapter VI-A deductions (80C, 80D, HRA, home-loan interest, NPS) but the standard deduction is only ₹50,000 and the 87A rebate covers income only up to ₹5 lakh.
| Income Range | Below 60 | Senior (60-80) | Super-senior (80+) |
|---|---|---|---|
| Up to ₹2,50,000 | Nil | Nil | Nil |
| ₹2,50,001 – ₹3,00,000 | 5% | Nil | Nil |
| ₹3,00,001 – ₹5,00,000 | 5% | 5% | Nil |
| ₹5,00,001 – ₹10,00,000 | 20% | 20% | 20% |
| Above ₹10,00,000 | 30% | 30% | 30% |
Basic exemption: ₹2.5L (below 60), ₹3L (senior 60-80), ₹5L (super-senior 80+). 87A rebate ₹12,500 up to ₹5L. Add 4% cess.
Surcharge & Cess — FY 2026-27
| Taxable Income | New Regime | Old Regime |
|---|---|---|
| Up to ₹50 lakh | Nil | Nil |
| ₹50L – ₹1 crore | 10% | 10% |
| ₹1 crore – ₹2 crore | 15% | 15% |
| ₹2 crore – ₹5 crore | 25% | 25% |
| Above ₹5 crore | 25% (capped) | 37% |
Surcharge is capped at 25% in the new regime (vs 37% old), so the peak effective rate is lower. Add 4% Health & Education Cess on tax plus surcharge. Marginal relief applies at each threshold.
Old vs New Regime — Which Is Cheaper?
The new regime wins for most people because of lower rates and the ₹12L nil-tax band. The old regime only wins when your deductions are large enough to offset its higher rates — roughly ₹4-5 lakh+ of deductions for typical incomes.
Default — lower rates, fewer deductions
- Zero tax up to ₹12.75L for salaried
- Lower rates & 25% surcharge cap
- ₹75,000 standard deduction
- No 80C/HRA/home-loan deductions
- Best when deductions are small
Optional — keep your deductions
- 80C, 80D, HRA, home-loan interest, NPS
- ₹50,000 standard deduction
- 87A only up to ₹5L income
- Higher slab rates & 37% top surcharge
- Best when deductions ≥ ~₹4-5L
New regime suits you if
- You have few investments or deductions
- You want zero tax up to ₹12.75L salary
- You rent nothing / claim little HRA
- You prefer simple, form-free filing
Old regime may win if
- You max 80C (₹1.5L) + 80D + NPS
- You claim large HRA
- You pay ₹2L home-loan interest
- Total deductions exceed ~₹4-5 lakh
Compare both regimes on your actual numbers in one click.
Old vs New Regime Calculator →Frequently Asked Questions
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