FY 2025-26 · AY 2026-27

Income Tax Slabs India

New regime vs old regime rates, 87A rebate, surcharge and cess — everything you need to calculate your tax liability for FY 2025-26.

Key change — Budget 2025 Under the new regime, income up to ₹12 lakh is effectively tax-free after the Section 87A rebate (₹60,000). Salaried individuals also get a ₹75,000 standard deduction, making the effective zero-tax threshold ₹12.75 lakh.

New Tax Regime — FY 2025-26 (Default)

The new regime is now the default. It has lower rates but most deductions (80C, HRA, etc.) are not available.

Income slab	Tax rate	Tax on slab amount
Up to ₹3,00,000	Nil	—
₹3,00,001 – ₹7,00,000	5%	₹20,000
₹7,00,001 – ₹10,00,000	10%	₹30,000
₹10,00,001 – ₹12,00,000	15%	₹30,000
₹12,00,001 – ₹15,00,000	20%	₹60,000
Above ₹15,00,000	30%	30% on amount above ₹15L

Section 87A Rebate (New Regime) If your total income is ₹12,00,000 or below, the tax computed above is fully waived via the 87A rebate (up to ₹60,000). Add ₹75,000 standard deduction for salaried employees → effective zero-tax threshold is ₹12,75,000.

Old Tax Regime — FY 2025-26

Opt for old regime if your deductions (80C, HRA, home loan, etc.) reduce taxable income more than the rate advantage of the new regime.

Income slab	Tax rate
Up to ₹2,50,000	Nil
₹2,50,001 – ₹5,00,000	5%
₹5,00,001 – ₹10,00,000	20%
Above ₹10,00,000	30%

Section 87A Rebate (Old Regime) If taxable income (after all deductions) is ₹5,00,000 or below, the rebate wipes out tax completely. Standard deduction in old regime is ₹50,000 for salaried individuals.

Surcharge

Applied on the base income tax (before cess). New regime caps surcharge at 25%.

Income range	Surcharge (old)	Surcharge (new)
Up to ₹50 lakh	Nil	Nil
₹50L – ₹1 Cr	10%	10%
₹1 Cr – ₹2 Cr	15%	15%
₹2 Cr – ₹5 Cr	25%	25%
Above ₹5 Cr	37%	25% (capped)

Health & Education Cess

4% on income tax + surcharge. Applied in both regimes.

New vs Old — Which Should You Choose?

New Regime (default)

Lower slab rates
Zero tax up to ₹12L (87A)
₹75,000 standard deduction (salaried)
No 80C, 80D, HRA, home loan deductions
Simple — just report income

Old Regime (opt-in)

Higher slab rates (20% band)
87A up to ₹5L after deductions
₹50,000 standard deduction (salaried)
Full 80C (₹1.5L), 80D, HRA, home loan
Better if deductions exceed ~₹3.75L

Rule of thumb: if you have 80C + HRA + home loan totalling more than ₹3.75 lakh, run the numbers under old regime. We can calculate this for you free.

Not sure which regime saves you more tax?

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Figures are based on Union Budget 2025 (Finance Act 2025). Rates apply to individuals and HUFs (resident, below 60 years). Senior citizens (60-79 years) and super senior citizens (80+) have higher basic exemption under old regime. Always verify with a CA for your specific situation.
Last updated: April 2025