New Tax Regime Slabs (FY 2026-27, same as FY 2025-26)
- •Income up to ₹4 lakh: nil. Then 5%, 10%, 15%, 20%, 25%, rising to 30% above ₹24 lakh.
- •Section 87A rebate makes taxable income up to ₹12 lakh effectively tax-free.
- •Standard deduction of ₹75,000 for salaried individuals under the new regime.
- •A 4% health & education cess applies on the calculated tax.
- •Budget 2026 kept these slabs unchanged from FY 2025-26.
The Real Problem This Solves
Most salaried people have no idea what they actually owe until TDS hits their payslip, then they scramble in March.
Worse, many still don't realise that since Budget 2025, taxable income up to ₹12 lakh is effectively tax-free under the new regime — with the ₹75,000 standard deduction, a salary of nearly ₹12.75 lakh can mean zero tax. This calculator gives you the real number.
How Your Tax Is Calculated
Tax is charged slab by slab, not on your whole income at one rate. The 87A rebate then wipes out tax entirely up to ₹12 lakh taxable income (with marginal relief just above it), and a 4% cess is added on top.
Example: Priya earns ₹15 lakh taxable. Her slab tax is ₹20,000 + ₹40,000 + ₹45,000 = ₹1,05,000, plus 4% cess = ₹1,09,200. Arjun, earning ₹11.5 lakh taxable, pays ₹0 thanks to the 87A rebate.
Not sure whether the old regime's deductions would actually beat this? Read old vs new tax regime, which one should you pick for a worked comparison at a higher income level.
| Taxable Income | Tax (New Regime) | With 4% Cess |
|---|---|---|
| ₹12,00,000 | ₹0 (87A rebate) | ₹0 |
| ₹15,00,000 | ₹1,05,000 | ₹1,09,200 |
| ₹18,00,000 | ₹1,60,000 | ₹1,66,400 |
| ₹25,00,000 | ₹3,30,000 | ₹3,43,200 |
Frequently Asked Questions
Is income up to ₹12 lakh really tax-free?
Yes, under the new regime since FY 2025-26. The Section 87A rebate cancels out the tax entirely for taxable income up to ₹12 lakh, and marginal relief protects those earning slightly above it. Add the ₹75,000 standard deduction and a salaried person with a ₹12.75 lakh gross salary can pay zero tax.
Did Budget 2026 change the tax slabs?
No. Budget 2026 kept the new-regime slabs and the ₹12 lakh rebate threshold unchanged for FY 2026-27, so the same structure introduced in Budget 2025 continues to apply.
Should I choose the old or new regime?
With the ₹12 lakh rebate, the new regime now wins for most salaried taxpayers. The old regime only makes sense if your combined deductions (HRA, 80C, 80D, home loan interest) are very large relative to your income. Compare both before filing.
Related Calculators
Know your tax now?
If you pay rent, you may be leaving a big deduction on the table under the old regime. Check your exemption with our HRA Calculator.
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