Old vs New Tax Regime (FY 2025-26)
The Indian government has heavily incentivised the New Tax Regime, making it the default option. However, depending on your investments and home loan status, the Old Regime might still save you more money.
The New Tax Regime Benefits
Under the New Regime (FY 2025-26), income up to ₹12 Lakhs is completely tax-free due to the expanded Section 87A rebate. Furthermore, the standard deduction has been increased to ₹75,000 for salaried employees. If you do not have significant investments (like ELSS, PPF) or a home loan, the New Regime is almost always better.
When to Choose the Old Regime
The Old Regime shines if your salary is above ₹15 Lakhs and you max out your deductions: ₹1.5L under 80C, ₹50k under 80CCD(1B), HRA exemptions, and up to ₹2L in home loan interest under Section 24(b). Use our calculator to mathematically verify which regime yields a higher take-home salary.