Income tax calculation in India changed significantly with the introduction of the New Tax Regime, which became the default from FY 2023-24. This Income Tax Calculator helps you estimate your tax liability under the New Regime for FY 2025-26, so you can plan your salary, investments, and deductions smartly.
What Is Income Tax?
Income tax is a direct tax levied by the Government of India on the income earned by individuals, HUFs, and corporations. For salaried individuals, tax is deducted at source (TDS) by the employer every month and deposited with the government. The annual Income Tax Return (ITR) reconciles your total tax liability with what was already deducted.
New Tax Regime Slabs (FY 2025-26)
| Income Slab | Tax Rate |
|---|---|
| ₹0 – ₹3,00,000 | Nil |
| ₹3,00,001 – ₹7,00,000 | 5% (Nil with Rebate u/s 87A) |
| ₹7,00,001 – ₹10,00,000 | 10% |
| ₹10,00,001 – ₹12,00,000 | 15% |
| ₹12,00,001 – ₹15,00,000 | 20% |
| Above ₹15,00,000 | 30% |
Plus: 4% Health & Education Cess on total tax. Standard Deduction of ₹75,000 applies for salaried employees.
Example Calculation
Scenario: Annual salary of ₹12,00,000. New Tax Regime.
- Gross Taxable Income = ₹12,00,000 − ₹75,000 (Standard Deduction) = ₹11,25,000
- Tax on ₹3–7L = ₹20,000 (5% of ₹4L)
- Tax on ₹7–10L = ₹30,000 (10% of ₹3L)
- Tax on ₹10–11.25L = ₹18,750 (15% of ₹1.25L)
- Total Tax = ₹68,750
- Add 4% Cess = ₹2,750
- Total Tax Payable = ₹71,500
How to Use This Income Tax Calculator
- Enter Annual Income: Your total gross annual income (salary, business income, etc.).
- Click Calculate: Get an instant, slab-wise tax breakdown under the New Regime.
- Compare Regimes: If you have heavy deductions (80C, HRA, home loan), compare with old regime.
Old vs New Tax Regime — Which Is Better?
- New Regime: Lower rates, simpler filing, no investment proof needed. Best for: income up to ₹10L with fewer deductions.
- Old Regime: Higher rates but allows HRA, 80C (₹1.5L), 80D, home loan interest. Best for: people with high deductions exceeding ₹3-4L.
- Break-Even Point: If your total deductions exceed ~₹3.75 lakh, old regime saves more tax.
Frequently Asked Questions (FAQs)
1. Is income up to ₹7 lakh really tax-free?
Yes, under the New Regime, Rebate u/s 87A makes effective tax Nil for income up to ₹7 lakhs (after standard deduction).
2. What is the standard deduction in New Regime?
₹75,000 for salaried employees and pensioners from FY 2024-25 onwards.
3. Can I switch between old and new tax regime every year?
Yes, salaried individuals can switch every year while filing ITR. Business income earners can switch only once.
4. Is this calculator for FY 2025-26?
Yes. It uses FY 2025-26 (AY 2026-27) New Tax Regime slabs as updated in the Union Budget.
5. Is this income tax calculator free?
Yes, completely free. No personal data is stored or transmitted.
Common Use Cases for Income Tax Calculator
- Use this Income Tax Calculator for quick, accurate online calculations — no app needed
- Ideal for students, professionals, and anyone planning finances or health goals
- Get instant results right in your browser — 100% private, no data stored
- Bookmark this page to use the Income Tax Calculator anytime, on any device