Income Tax Slab 2025-26 —
Zero Tax up to ₹12 Lakh
New and old regime slab rates for FY 2025-26 (AY 2026-27) after Budget 2025 — the ₹12 lakh rebate, ₹75,000 standard deduction, surcharge, cess and how to pick the right regime.
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 makes tax NIL up to ₹12,00,000 taxable income — a salaried person pays nil up to about ₹12.75L after the ₹75,000 standard deduction. The old regime stays optional with its 80C-style deductions.
New Regime Slabs — FY 2025-26
These slabs apply automatically unless you opt for the old regime. Tax is computed slab-by-slab on taxable income (after the ₹75,000 standard deduction for salary/pension), then reduced by the 87A rebate.
| Income Slab | Rate | Tax on 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 tax. 87A rebate makes tax nil up to ₹12L taxable income. Verify on incometax.gov.in before filing.
Zero tax up to ₹12L does NOT mean the first ₹12L is exempt for everyone. It works through the Section 87A rebate: if your taxable income is ₹12L or below, the rebate wipes out the computed tax. Cross ₹12L by even ₹1 and tax is charged on the slabs (marginal relief softens the jump just above ₹12L). Special-rate incomes like equity STCG/LTCG and lottery do not get the rebate.
Want your exact FY 2025-26 tax in 30 seconds?
Open the Calculator →Old Regime Slabs — FY 2025-26 (Unchanged)
The old regime is optional and its slabs are unchanged. Choose it only if your deductions (80C, 80D, HRA, home-loan interest, NPS) are large enough to beat the new regime. Standard deduction here is ₹50,000.
| Income Slab | Rate (below 60) | Notes |
|---|---|---|
| Up to ₹2,50,000 | Nil | Basic exemption |
| ₹2,50,001 – ₹5,00,000 | 5% | 87A rebate up to ₹5L → nil |
| ₹5,00,001 – ₹10,00,000 | 20% | — |
| Above ₹10,00,000 | 30% | — |
Senior citizens (60–80): basic exemption ₹3,00,000. Super-senior (80+): ₹5,00,000. Add 4% cess.
- Standard deduction ₹50,000 on salary/pension.
- Chapter VI-A deductions available — 80C up to ₹1.5L, 80D health insurance, 80CCD(1B) NPS ₹50,000, 80G donations and more.
- HRA and home-loan interest (up to ₹2L on a self-occupied house) can be claimed.
- Section 87A rebate up to ₹5L taxable income (₹12,500), versus ₹12L in the new regime.
New regime — low rates, few deductions
- Default from FY 2025-26
- Tax-free up to ₹12L (87A)
- Standard deduction ₹75,000
- Almost no other deductions
- Best when investments are low
Old regime — higher rates, full deductions
- Must be actively opted
- Tax-free up to ₹5L (87A)
- Standard deduction ₹50,000
- 80C, 80D, HRA, home loan, NPS
- Best when deductions are high
New vs Old Regime — Which Saves More?
As a rough guide the new regime wins unless your total deductions exceed roughly ₹3.5–4 lakh. Run both before you lock a regime — the exact break-even shifts with income and HRA.
| Taxable income | New regime tax | Old regime (≈₹3.75L deductions) | Better |
|---|---|---|---|
| ₹8,00,000 | ₹0 | ₹0 | New (simpler) |
| ₹12,00,000 | ₹0 | ≈₹44,200 | New |
| ₹15,00,000 | ₹1,09,200 | ≈₹78,000 | Old if deductions ≥ ₹3.75L |
| ₹20,00,000 | ₹2,08,000 | ≈₹1,66,000 | Old if deductions ≥ ₹4L |
| ₹30,00,000 | ₹5,20,000 | ≈₹5,72,400 | New |
Illustrative, before cess/surcharge. Old-regime figures assume the stated deductions; your numbers may differ.
Salary ₹12.75L — new regime
Salary ₹16.75L — new regime
Pick the NEW regime if
- You have few or no investments/loans to claim
- Your total deductions are below ~₹3.75L
- You want the simplest filing with zero tax up to ₹12L
- You are salaried with only the standard deduction
Pick the OLD regime if
- You claim large HRA plus 80C ₹1.5L plus 80D
- You pay home-loan interest up to ₹2L
- Your total deductions comfortably exceed ~₹4L
- You have NPS 80CCD(1B) and 80G donations too
Not sure which regime is cheaper for you?
Run the Old vs New Calculator →Section 87A Rebate, Standard Deduction & Cess
- Section 87A rebate: makes tax nil up to ₹12,00,000 taxable income in the new regime (up to ₹5,00,000 in the old regime).
- Standard deduction: ₹75,000 in the new regime, ₹50,000 in the old, for salary and pension income.
- Health & education cess: 4% on income tax (plus surcharge, if any) in both regimes.
- Marginal relief: just above ₹12L in the new regime, extra tax is capped so you never pay more than the income exceeding ₹12L.
Surcharge on Income Tax — FY 2025-26
Surcharge is an extra levy on income tax for higher incomes, on top of the 4% cess. The new regime caps the top surcharge at 25%; the old regime can go up to 37%.
| Total income | Surcharge (new) | Surcharge (old) |
|---|---|---|
| ₹50L – ₹1 crore | 10% | 10% |
| ₹1 crore – ₹2 crore | 15% | 15% |
| ₹2 crore – ₹5 crore | 25% | 25% |
| Above ₹5 crore | 25% | 37% |
Surcharge above ₹5 crore is capped at 25% in the new regime. Marginal relief applies at each surcharge threshold.
From AY 2026-27 the new Income-tax Act, 2025 replaces the 1961 Act with renumbered sections and simplified language, but the FY 2025-26 slab rates, the ₹12L rebate and the ₹75,000 standard deduction are unchanged. Rate figures here follow the Budget 2025 rates notified on incometax.gov.in — always confirm the current section reference before quoting it in a return.
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