Old vs New Tax Regime
Which regime should you pick for FY 2025-26? Enter your income and deductions to see your tax under both — and which saves you more.
Your numbers
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New regime wins
The New regime saves you about ₹27.3K a year. The lower slab rates beat your available deductions.
New regime tax
₹97,500
Old regime tax
₹1,24,800
Deductions used (old)
₹4.75L
ℹ️ FY 2025-26 slabs, including the ₹75,000 standard deduction and the new regime's tax-free income up to ₹12L. A simplified estimate — verify with a tax professional.
Annual tax: New vs Old
Old vs new tax regime: which should you choose?
It comes down to a trade-off: the new regime has lower slab rates but almost no deductions, while the old regime taxes at higher rates but lets you claim 80C, 80D, HRA, home-loan interest and more. The more deductions you genuinely have, the more the old regime can win. With few deductions, the new regime's lower rates usually come out ahead.
FY 2025-26 slabs
Under the new regime (with a ₹75,000 standard deduction), Budget 2025 made income up to ₹12 lakh effectively tax-free via a rebate, with rates then rising in ₹4 lakh bands from 5% to 30%:
| Income (after std. deduction) | Rate |
|---|---|
| Up to ₹4,00,000 | 0% |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
The old regime keeps the familiar 5% / 20% / 30% slabs (with a ₹50,000 standard deduction) but allows the full range of deductions.
The break-even: how many deductions do you need?
Roughly, the old regime only wins once your total deductions are large — often ₹3.5–4 lakh or more, depending on income. If you max out 80C (₹1.5L), pay for health insurance (80D), claim significant HRA, and have a home-loan interest deduction, the old regime can beat the new. If you don't, the new regime's lower rates and simplicity usually win.
Don't forget simplicity
The new regime needs no proof, no tracking, no locked-in investments. For many people the small difference isn't worth the hassle of tax-saving lock-ins — and the freed-up cash can be invested more flexibly.
Related tools
- Prepay Loan vs Invest — the home-loan tax break in action.
- PPF Calculator — a popular 80C, old-regime deduction.
Frequently asked questions
Is the new tax regime better than the old one?
If you have few deductions, the new regime's lower rates usually mean less tax. If you claim large deductions (80C, 80D, HRA, home-loan interest), the old regime can win. Compare both with your numbers.
Is income up to ₹12 lakh tax-free under the new regime?
For FY 2025-26, the new regime makes income up to ₹12 lakh (after the standard deduction) effectively tax-free via a rebate. Above that, normal slab rates apply.
Can I switch between the old and new regime each year?
Salaried individuals without business income can generally choose the regime each financial year. Those with business income face more restrictions on switching.
Which regime should I pick if I have a home loan?
If your home-loan interest plus other deductions are large, the old regime may save more. If the loan is small or nearly paid off, the new regime often wins. Compare both above.