Income Tax Calculator
(New Tax Regime)
Total salary/income before any deductions
*Disclaimer: Calculations are based on the standard New Tax Regime slabs. Assumes ₹50,000 standard deduction and 87A rebate up to ₹7 Lakhs.
Income Tax Calculator — Find Out Your Exact Tax Liability for FY 2025-26 in Seconds
Last Updated: May 2026 | For FY 2025-26 (AY 2026-27) | Reading Time: ~5 minutes By Sunita Yadav | Finance Educator, EasyInvestCalc
Last March, a friend texted me in mild panic. His Form 16 had arrived, his CTC was ₹14 lakh, his employer had deducted TDS all year — and he had no idea if he had paid too much, too little, or the right amount.
Fifteen minutes on the phone was all it took. We applied the standard deduction, ran the slabs, checked his rebate. He had been overtaxed by ₹8,000 — a refund waiting to be claimed.
That conversation takes fifteen minutes with guidance. This calculator does it in fifteen seconds.
Enter your gross annual income above. The calculator applies the ₹75,000 standard deduction, runs your net income through the FY 2025-26 slabs, applies the Section 87A rebate if eligible, adds 4% cess, and shows your final tax payable. No registration, no waiting.
Understanding how the number is calculated helps you plan — not just this year, but every year after.
What Changed in FY 2025-26 — And Why It Matters to You
The Union Budget 2025 brought the most significant income tax changes in years. Three updates define the FY 2025-26 new regime:
Basic exemption increased to ₹4 lakh — the first ₹4 lakh is taxed at zero.
Section 87A rebate raised from ₹25,000 to ₹60,000 — meaning salaried individuals with gross income up to ₹12.75 lakh pay zero tax, without any investments or exemptions.
Standard deduction increased from ₹50,000 to ₹75,000 — applied automatically to every salaried employee, no proof required.
Together, these changes give a large portion of salaried India a genuine zero-tax outcome without any active planning. Our calculator reflects all three precisely.
New Tax Regime Slabs — FY 2025-26 (AY 2026-27)
Here are the income tax slabs under the new regime for the current financial year, applicable to all resident individuals regardless of age:
| Annual Taxable Income | Tax Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹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% |
A 4% Health and Education Cess is applied on the total tax computed after rebates. The new regime is now the default regime for all individuals — if you do not actively opt for the old regime when filing your ITR, you are assessed under these slabs.
The Zero-Tax Limit — How ₹12.75 Lakh Gross Income Becomes Zero Tax
This is the part that still surprises many salaried Indians, so let us walk through it step by step with a concrete example.
Example — Gross Salary ₹12,75,000:
| Step | Amount |
|---|---|
| Gross Annual Salary | ₹12,75,000 |
| Less: Standard Deduction | ₹75,000 |
| Net Taxable Income | ₹12,00,000 |
| Tax as per FY 2025-26 slabs | ₹60,000 |
| Less: Section 87A Rebate | ₹60,000 |
| Total Tax Payable | ₹0 |
The slab calculation on ₹12 lakh produces a tax of ₹60,000. The Section 87A rebate is also exactly ₹60,000. They cancel each other out perfectly. Net result: zero tax liability for a gross salary of ₹12.75 lakh.
This is not a loophole. It is not a special scheme you need to apply for. It is simply how the 2025 Budget redesigned the tax structure — and our calculator applies every one of these steps automatically when you enter your income.
What Happens Just Above ₹12 Lakh — Marginal Relief Explained
One of the most common questions around this zero-tax threshold is: if my taxable income is ₹12,10,000 instead of exactly ₹12,00,000, do I suddenly owe tax on the full amount?
The answer is no — and the mechanism that prevents this is called Marginal Relief.
Without marginal relief, crossing ₹12 lakh by even ₹1 would trigger a tax bill of over ₹60,000 — an absurd outcome where earning slightly more income would make you significantly worse off. Marginal relief prevents exactly this by capping your additional tax at the amount by which your income exceeds ₹12 lakh.
In plain terms: if your net taxable income is ₹12,10,000, your total tax payable is limited to ₹10,000 — the difference between your income and the ₹12 lakh threshold. Not ₹60,000. Not the full slab-computed figure. Just ₹10,000.
Marginal relief phases out as income rises and disappears completely once taxable income crosses ₹12,75,000. Our calculator handles this automatically — the result already reflects marginal relief wherever it applies.
New Regime vs Old Regime — Which One Suits You?
The right answer depends entirely on your situation.
New regime wins when your deductions are modest. For most salaried individuals under ₹15 lakh with no home loan, the lower slabs and zero-tax limit are hard to beat.
Old regime wins when you have a home loan with large interest payments, claim HRA, and max out Section 80C each year. If your combined deductions — HRA, home loan interest, 80C, 80D — comfortably exceed ₹3.75 lakh, the old regime may reduce your liability further.
Best approach: Calculate both before filing. For an official side-by-side comparison, use the Income Tax Department’s portal.
What Deductions Are Still Available Under the New Regime?
A common misconception is that the new tax regime allows absolutely no deductions. This is not entirely accurate. While most traditional deductions are unavailable, three remain:
Standard Deduction — ₹75,000: Available to all salaried employees and pensioners automatically, without any investment or declaration required.
Employer NPS Contribution — Section 80CCD(2): If your employer contributes to your NPS account, that amount — up to 10% of basic salary — is still deductible under the new regime. One of the most underused savings available to salaried employees.
Family Pension Deduction: A deduction of ₹15,000 or one-third of pension received — whichever is lower — applies to family pension income.
Everything else is off the table: Section 80C, 80D, HRA, LTA, home loan interest under 24(b), and most Chapter VI-A deductions.
Frequently Asked Questions
What is the last date to file ITR for FY 2025-26? The due date for salaried individuals is July 31, 2026. Late filing attracts a fee of ₹5,000 under Section 234F (₹1,000 if total income is under ₹5 lakh). Filing on time also allows you to carry forward capital losses.
Is the 87A rebate available on capital gains income? No. The 87A rebate does not apply to income taxed at special flat rates — including LTCG under Section 112A from equity mutual funds. Capital gains may attract tax even if total income is near ₹12 lakh.
Does the new regime offer different slabs for senior citizens? No. Unlike the old regime — where senior citizens (60–79 years) get a higher basic exemption of ₹3 lakh and super senior citizens (80+) get ₹5 lakh — the new regime applies the same slab structure to all age groups. Senior citizens evaluating their regime choice should factor this in alongside their deduction eligibility under the old regime.
One Planning Tip Worth Acting on This Year
If your gross salary falls between ₹12.75 lakh and ₹17 lakh — the range where you are now paying meaningful tax under the new regime — the single best structural change you can make is to ask your employer to route a portion of your CTC through an employer NPS contribution under Section 80CCD(2).
At 10% of basic salary, this is deductible under the new regime. On a basic of ₹6 lakh, that is ₹60,000 less in taxable income — saving ₹9,000 to ₹12,000 in annual tax, with no out-of-pocket cost.
Once you know your tax number, the next question is how to grow what’s left. Our PPF Calculator and SIP Calculator are useful next steps.
Important Disclaimer
The Income Tax Calculator on EasyInvestCalc.com is a free educational tool. Results are estimates based on New Tax Regime slabs for FY 2025-26 (AY 2026-27). This calculator does not account for surcharge above ₹50 lakh, capital gains tax, business income, or agricultural income. Tax laws are subject to change.
Results are not professional tax advice. EasyInvestCalc.com is not a CA, registered tax advisor, or financial institution. Consult a qualified CA before filing. For official tax information, visit the Income Tax Department of India.
Need more financial tools? Our EMI Calculator helps you plan loan repayments, and the NPS Calculator shows how employer NPS contributions can reduce your taxable income under the new regime.