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Old vs New Tax Regime Calculator

Both regimes computed on the same income, with the deduction total at which the old regime overtakes the new one. That break-even is the number the choice actually turns on.

Also called: which tax regime is better, new vs old regime comparison.

₹
₹
₹
Tax year
Which regime costs less
The new regime costs less

The new regime costs less. New regime ₹97,500, old regime ₹2,10,600, a difference of ₹1,13,100.

Tax under the new regime
₹97,500
Tax under the old regime
₹2,10,600
Difference
₹1,13,100
Deductions needed for the old regime to win
₹5,43,750
Effective rate, new regime
6.84%
Effective rate, old regime
16.2%
How this is calculated

Computed from the published rates for the tax year you selected, which is not necessarily the current year. A calculation, not tax advice, and it does not know anything about your circumstances beyond the figures entered.

Method and background

This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for India change on a published schedule; the effective date is shown on every rule-based tool.

How this is calculated

The new regime has wider slabs and a larger standard deduction but disallows almost every exemption. The old regime has narrower slabs and allows them. Which wins is entirely a question of how much you can actually deduct, so this computes both and then solves for the deduction total at which they are equal. Below that figure the new regime is cheaper; above it, the old one.

tax = sum over bands of rate * (income inside that band)
I
Taxable income (currency)
L_b
Lower edge of a band (currency)
U_b
Upper edge of a band (currency)
r_b
The rate for that band (decimal)

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

at fifteen lakh with only 80C, the new regime wins

Gross annual income
₹15,00,000
Section 80C investments
₹1,50,000
Other old-regime deductions (80D, 24b, HRA)
₹0
Tax year
FY 2025-26 (AY 2026-27)

Which regime costs lessThe new regime costs less

New-regime figure cross-checked against the income-tax calculator case above

Open this example

heavy deductions swing it to the old regime

Gross annual income
₹15,00,000
Section 80C investments
₹1,50,000
Other old-regime deductions (80D, 24b, HRA)
₹5,00,000
Tax year
FY 2025-26 (AY 2026-27)

Which regime costs lessThe old regime costs less

6.5 lakh of deductions is far past the break-even at this income

Open this example

Method and limits

What it assumes

  • A resident individual below sixty, with salaried income so the standard deduction applies.
  • Deductions entered are assumed to be allowable in full under the old regime.

What it deliberately does not model

  • The break-even is found numerically and is accurate to the nearest rupee, not derived in closed form.
  • It does not model the cost of locking money into 80C instruments to reach a deduction total.

Sources

Formula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator

Frequently asked questions

Can I switch regimes every year?
A salaried taxpayer without business income may choose afresh each year. Someone with business income who opts out of the new regime is generally restricted in returning to it. Check the current rule for your own situation.
Why does the old regime win only at high deductions?
Because it buys narrower slabs with the exemptions it allows. Until the exemptions are worth more than the slab difference, the new regime is simply cheaper. The break-even figure on this page is exactly that crossing point.