Short answer
For Tax Year 2026-27, income up to ₹12 lakh is tax-free under the new regime because of the rebate in Section 156 of the Income-tax Act, 2025. For salaried people, the ₹75,000 standard deduction takes that to ₹12.75 lakh. Above that, new-regime rates run from 5% to 30% in ₹4 lakh steps, plus 4% cess.
The new regime is the default. The old regime wins only when your deductions are large: about ₹5.4 lakh at a ₹15 lakh salary and ₹8 lakh at ₹25 lakh and above. Budget 2026 did not change any slab or rate.
How to use this income tax calculator
- 1Choose salaried or freelancerSalaried gets the standard deduction. Freelancers and small businesses can use presumptive income under Section 58, where tax is paid on a fixed share of receipts.
- 2Pick your ageAge changes the tax-free limit under the old regime only. The new regime uses the same slabs for everyone.
- 3Enter your incomeAdd salary or receipts, then interest and rent. The calculator applies the 30% deduction on rent for you.
- 4Add your deductionsSearch by the old section number, such as 80C or 80D, or by what you paid for. Limits are applied automatically, and each item shows whether it counts in the new regime.
- 5Compare and planThe panel shows both regimes side by side, the cheaper one, and the extra deduction you would need before the old regime wins.
Income tax slab rates for Tax Year 2026-27
These rates apply to income earned from 1 April 2026 to 31 March 2027. They are the same as FY 2025-26 (AY 2026-27), so you can also use this page for the return you file this year.
New tax regime (default, Section 202)
| Taxable income | Rate | Tax on this slab | Total tax at top of slab |
|---|---|---|---|
| Up to ₹4,00,000 | Nil | ₹0 | ₹0 |
| ₹4,00,001 to ₹8,00,000 | 5% | ₹20,000 | ₹20,000 |
| ₹8,00,001 to ₹12,00,000 | 10% | ₹40,000 | ₹60,000 |
| ₹12,00,001 to ₹16,00,000 | 15% | ₹60,000 | ₹1,20,000 |
| ₹16,00,001 to ₹20,00,000 | 20% | ₹80,000 | ₹2,00,000 |
| ₹20,00,001 to ₹24,00,000 | 25% | ₹1,00,000 | ₹3,00,000 |
| Above ₹24,00,000 | 30% | 30% of the excess | ₹3,00,000 + 30% above ₹24L |
Total tax at the top of a slab is before the rebate and cess. Up to ₹12 lakh the rebate cancels it, so the tax is nil.
Old tax regime (by age)
| Taxable income | Below 60 | 60 to 79 | 80 or above |
|---|---|---|---|
| Up to ₹2,50,000 | Nil | Nil | Nil |
| ₹2,50,001 to ₹3,00,000 | 5% | Nil | Nil |
| ₹3,00,001 to ₹5,00,000 | 5% | 5% | Nil |
| ₹5,00,001 to ₹10,00,000 | 20% | 20% | 20% |
| Above ₹10,00,000 | 30% | 30% | 30% |
Age is counted on the last day of the tax year. A person who turns 60 on or before 31 March 2027 is a senior citizen for Tax Year 2026-27.
Rebate and marginal relief at ₹12 lakh
Section 156 of the Income-tax Act, 2025 (earlier Section 87A) gives resident individuals a rebate that wipes out tax on lower incomes.
| Regime | Taxable income up to | Maximum rebate | Tax payable |
|---|---|---|---|
| New regime | ₹12,00,000 | ₹60,000 | Nil |
| Old regime | ₹5,00,000 | ₹12,500 | Nil |
Marginal relief. Under the new regime, if taxable income is just above ₹12 lakh, your tax cannot be more than the income above ₹12 lakh. At ₹12,10,000, the slab tax is ₹61,500, but you pay only ₹10,000 plus cess. The relief stops at ₹12,70,588 of taxable income, where the slab tax becomes lower than the excess.
The rebate does not cover tax on special-rate income, such as capital gains on listed shares and equity funds.
Surcharge and health & education cess
| Taxable income | New regime | Old regime |
|---|---|---|
| Up to ₹50 lakh | Nil | Nil |
| ₹50 lakh to ₹1 crore | 10% | 10% |
| ₹1 crore to ₹2 crore | 15% | 15% |
| ₹2 crore to ₹5 crore | 25% | 25% |
| Above ₹5 crore | 25% (capped) | 37% |
Surcharge on dividends and capital gains is capped at 15%. Marginal relief also applies at each surcharge threshold: the extra tax cannot exceed the income above the threshold. A 4% health and education cess is then added to tax plus surcharge, in both regimes.
Deductions: old section, new section and regime
The Income-tax Act, 2025 renumbered every deduction. Search by the old number if that is how you know it.
| Deduction | Old section | New section | Limit · regime |
|---|---|---|---|
| Standard deduction on salary or pension | 16(ia) | 19 | ₹75,000 new · ₹50,000 old |
| Employer's contribution to NPS | 80CCD(2) | 124 | 14% of basic + DA new · 10% old |
| Agniveer Corpus Fund | 80CCH | 125 | Full contribution · both |
| PF, PPF, ELSS, life insurance, tuition fees, home loan principal, own NPS | 80C, 80CCC, 80CCD(1) | 123 | ₹1,50,000 combined · old only |
| Additional own NPS contribution | 80CCD(1B) | 124 | ₹50,000 · old only |
| Health insurance and check-ups | 80D | 126 | ₹25,000 self (₹50,000 if 60+), plus ₹25,000 or ₹50,000 for parents · old only |
| Interest on home loan, self-occupied house | 24(b) | 22 | ₹2,00,000 · old only |
| House rent allowance | 10(13A) | Schedule (salary exemptions) | Least of three limits · old only |
| Professional tax | 16(iii) | 19 | Actual, up to ₹2,500 · old only |
| Education loan interest | 80E | 129 | No limit, for 8 years · old only |
| Donations to approved funds and charities | 80G | 133 | 50% or 100%, some capped at 10% of income · old only |
| Savings account interest (deposit interest for seniors) | 80TTA, 80TTB | 153 | ₹10,000 · ₹50,000 if 60+ · old only |
| Disabled dependant | 80DD | 127 | ₹75,000 · ₹1,25,000 if severe · old only |
| Treatment of specified diseases | 80DDB | 128 | ₹40,000 · ₹1,00,000 if 60+ · old only |
| Person with disability (self) | 80U | 154 | ₹75,000 · ₹1,25,000 if severe · old only |
Old or new regime: which is better for you?
Compare your total deductions with the break-even figure for your salary. If your deductions are higher, the old regime saves tax. If they are lower, stay with the new regime. The figures are for a salaried person below 60, over and above the standard deduction.
| Gross salary | Tax, new regime | Old regime wins if deductions exceed |
|---|---|---|
| ₹10,00,000 | Nil | Never lower; best case is also nil at ₹4,50,000 |
| ₹12,75,000 | Nil | Never lower; best case is also nil at ₹7,25,000 |
| ₹15,00,000 | ₹97,500 | ₹5,43,750 |
| ₹18,00,000 | ₹1,50,800 | ₹6,41,667 |
| ₹20,00,000 | ₹1,92,400 | ₹7,08,333 |
| ₹25,00,000 | ₹3,19,800 | ₹8,00,000 |
| ₹30,00,000 | ₹4,75,800 | ₹8,00,000 |
| ₹50,00,000 | ₹10,99,800 | ₹8,00,000 |
- Up to ₹12.75 lakh salary, the new regime already gives nil tax. The old regime can at best match it.
- From ₹25 lakh upward, you need ₹8 lakh of deductions. Most people reach ₹1.5 lakh (123), ₹50,000 (NPS), ₹75,000 (health cover) and ₹2 lakh (home loan), which is ₹4.75 lakh. The rest must come from HRA.
- The old ₹3.75 lakh rule is out of date. It was based on the FY 2024-25 slabs. With the wider slabs from April 2025, you need much larger deductions.
Salaried people can choose the regime every year when they file the return. If you have business or professional income, you can move from the new regime to the old regime only once in your lifetime, so check the numbers carefully before opting out.
How income tax is calculated: four worked examples
Take gross income, subtract the standard deduction and any allowed deductions, apply the slabs, subtract the rebate, and add surcharge and 4% cess.
Taxable income is ₹12,75,000 minus ₹75,000 = ₹12,00,000. Slab tax is ₹60,000, and the Section 156 rebate is also ₹60,000.
Tax payable: nil
Slab tax is ₹61,500. Marginal relief caps the tax at the ₹10,000 earned above ₹12 lakh.
₹10,000 + 4% cess = ₹10,400
Old regime: ₹14,00,000 − ₹50,000 − ₹4,20,000 = ₹9,30,000 taxable, so tax is ₹98,500. New regime: ₹14,00,000 − ₹75,000 = ₹13,25,000 taxable, so tax is ₹78,750.
Old ₹1,02,440 vs new ₹81,900 with cess: new saves ₹20,540
Under Section 58 (earlier 44ADA), 50% is treated as profit: ₹20,00,000. There is no standard deduction for business income.
New regime: ₹2,00,000 + 4% cess = ₹2,08,000, paid as advance tax by 15 March 2027
Income tax for freelancers and small businesses
Section 58 of the Income-tax Act, 2025 lets you pay tax on a fixed share of receipts instead of keeping full books. It replaced Sections 44AD, 44ADA and 44AE.
| Who | Profit taken as | Receipts limit |
|---|---|---|
| Professionals: CA, lawyer, doctor, engineer, architect, IT or technical consultant, interior designer, film artist, CS (earlier 44ADA) | 50% of receipts | ₹75 lakh if cash is up to 5%, else ₹50 lakh |
| Traders, manufacturers and other small businesses (earlier 44AD) | 6% of bank receipts, 8% of cash | ₹3 crore if cash is up to 5%, else ₹2 crore |
| Commission or agency business | Not eligible. Pay tax on actual profit. | |
Under presumptive taxation, advance tax is due in one instalment by 15 March. You may declare a higher profit than the fixed share. If you want to declare lower profit, you need books of account and, above the audit limit, a tax audit.
Advance tax and ITR due dates for Tax Year 2026-27
| Date | What is due |
|---|---|
| 15 June 2026 | 15% of advance tax |
| 15 September 2026 | 45% of advance tax (cumulative) |
| 15 December 2026 | 75% of advance tax (cumulative) |
| 15 March 2027 | 100% of advance tax, or the full amount under presumptive taxation |
| 31 July 2027 | Return for salaried people and others with no business income |
| 31 August 2027 | Return for business or professional income not needing an audit |
| 31 October 2027 | Return for taxpayers who need a tax audit |
Advance tax applies when tax for the year, after TDS, is ₹10,000 or more. Resident senior citizens with no business income do not pay advance tax. Use the advance tax calculator to work out each instalment and interest for a shortfall.
What changed from 1 April 2026?
The Income-tax Act, 2025 replaced the 1961 Act for income earned from 1 April 2026. Rates and limits did not change. The words and numbers did.
- "Tax Year" replaces FY and AY. Tax Year 2026-27 is the year you earn the income, April 2026 to March 2027. You file the return for it in 2027.
- New section numbers. 115BAC is now Section 202, 87A is Section 156, 80C is Section 123 and 80D is Section 126. See the deductions table.
- Budget 2026 made no slab change. The slabs and the ₹12 lakh rebate from April 2025 carry forward to Tax Year 2026-27.
- Later ITR date for small businesses. Returns with business income that do not need an audit are now due on 31 August instead of 31 July.
Frequently asked questions
How much income is tax-free in 2026-27?
Up to ₹12 lakh of taxable income is tax-free under the new regime, because the rebate under Section 156 of the Income-tax Act, 2025 covers tax of up to ₹60,000. For salaried people, the ₹75,000 standard deduction raises this to a gross salary of ₹12.75 lakh. Under the old regime, the limit is ₹5 lakh of taxable income.
Did Budget 2026 change the income tax slabs?
No. The Finance Act, 2026 kept the slabs, the ₹12 lakh rebate and the ₹75,000 standard deduction unchanged. The slabs for Tax Year 2026-27 are the same as FY 2025-26: nil up to ₹4 lakh, then 5%, 10%, 15%, 20%, 25% and 30% in steps of ₹4 lakh.
Which is better in 2026-27, the old or new regime?
The new regime is better unless your deductions are large. At a ₹15 lakh salary you need about ₹5.44 lakh of deductions beyond the standard deduction for the old regime to win, and from ₹25 lakh upward you need ₹8 lakh. Up to ₹12.75 lakh salary the new regime already gives nil tax.
What is Tax Year 2026-27?
Tax Year is the term the Income-tax Act, 2025 uses in place of financial year and assessment year. Tax Year 2026-27 is the period from 1 April 2026 to 31 March 2027, in which the income is earned. The return for it is filed in 2027.
What is marginal relief at ₹12 lakh?
If your taxable income under the new regime is slightly above ₹12 lakh, your tax cannot exceed the income above ₹12 lakh. At ₹12,10,000, the slab tax is ₹61,500 but you pay only ₹10,000 plus cess. The relief ends at ₹12,70,588 of taxable income.
Can I claim 80C and 80D in the new regime?
No. Section 80C is now Section 123 and Section 80D is now Section 126, and both are available only in the old regime. The new regime allows the ₹75,000 standard deduction, the employer's NPS contribution under Section 124 up to 14% of basic plus DA, and the Agniveer Corpus Fund deduction.
What is the standard deduction for 2026-27?
₹75,000 under the new regime and ₹50,000 under the old regime, for salary and pension. It is now in Section 19 of the Income-tax Act, 2025 (earlier Section 16(ia)). It is not available on business or freelance income.
Can I switch between the old and new regime every year?
If you have no business or professional income, yes, you can choose each year when you file the return. If you have business or professional income, you can opt out of the new regime and come back to it only once in your lifetime.
What are the tax slabs for senior citizens?
The new regime slabs are the same for all ages. Under the old regime, income up to ₹3 lakh is tax-free for people aged 60 to 79 and up to ₹5 lakh for people aged 80 or above. Senior citizens can also claim ₹50,000 for health insurance and ₹50,000 for deposit interest in the old regime.
How is a freelancer's income tax calculated?
Professionals such as software developers, doctors and consultants can pay tax on 50% of receipts under Section 58 (earlier 44ADA), if receipts are up to ₹75 lakh and cash receipts are within 5%. Small businesses pay on 6% of bank receipts and 8% of cash receipts, up to ₹3 crore. Tax is then worked out on the regime slabs, and advance tax is due in one instalment by 15 March.
Does this calculator include surcharge and cess?
Yes. Surcharge of 10% to 37% applies above ₹50 lakh of income, capped at 25% in the new regime, with marginal relief at each threshold. A 4% health and education cess is added to tax plus surcharge in both regimes.
Does the calculator cover capital gains?
No. Capital gains on shares, mutual funds and property are taxed at special rates and are not covered by the ₹12 lakh rebate. Leave them out of the calculator and add the tax on them separately, or ask a CA to compute it with your return.
When is the ITR due for Tax Year 2026-27?
31 July 2027 for salaried people and others without business income. 31 August 2027 for business or professional income that does not need an audit, after Budget 2026 moved this date. 31 October 2027 for cases that need a tax audit.