Old vs new income tax regime
How the new (default) and old income tax regimes differ for FY 2025-26: slab rates, the 87A rebate, standard deduction and which deductions you lose.
Tax Colony is an independent educational site, not a tax adviser or filing service. Verify with official sources or a professional before acting.
The new regime is the default for individuals, HUFs, AOPs and BOIs. You can choose the old regime instead when you file. Different rules on switching apply if you have business or professional income.
New regime slabs
| Income | Rate |
|---|---|
| ₹0 to ₹4,00,000 | 0% |
| ₹4,00,001 to ₹8,00,000 | 5% |
| ₹8,00,001 to ₹12,00,000 | 10% |
| ₹12,00,001 to ₹16,00,000 | 15% |
| ₹16,00,001 to ₹20,00,000 | 20% |
| ₹20,00,001 to ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
- Standard deduction on salary or pension: ₹75,000.
- Section 87A rebate up to ₹60,000, so tax is nil if total income is up to ₹12,00,000. It does not cover tax on special-rate income such as capital gains.
- Employer’s NPS contribution under section 80CCD(2) is still allowed.
Old regime slabs (below 60)
| Income | Rate |
|---|---|
| ₹0 to ₹2,50,000 | 0% |
| ₹2,50,001 to ₹5,00,000 | 5% |
| ₹5,00,001 to ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Senior citizens (60 to 79) and super senior citizens (80 and above) get a higher nil slab.
- Standard deduction on salary: ₹50,000.
- Section 87A rebate up to ₹12,500, so tax is nil if total income is up to ₹5,00,000.
What you give up in the new regime
The new regime does not allow 80C, 80CCC, 80CCD(1), 80CCD(1B), 80D, 80DD, 80DDB, 80E, 80EE, 80EEA, 80EEB, 80G, 80GG, 80GGA, 80GGC, 80QQB, 80RRB, 80TTA, 80TTB or 80U.
Both regimes
Surcharge applies above ₹50 lakh with marginal relief. Health and education cess is 4% of tax plus surcharge.
Tax year 2026-27 onwards
The Income-tax Act, 2025 applies from 1 April 2026. “Previous year” and “assessment year” are replaced by a single “tax year”. The new regime slabs for tax year 2026-27 are the same as those above.
Use the income tax calculator to compare both regimes with your own figures.
Sources
- Income Tax Department e-filing help: salaried individuals (AY 2026-27)
- CBDT e-filing ITR-2 validation rules, AY 2026-27
- Union Budget 2026-27 memorandum explaining provisions
Last verified: 4 Nov 2026