Old vs New Tax Regime Calculator

It depends on your deductions. If your total deductions (80C + HRA + 80D + home loan + NPS) exceed ₹3.75-4 lakh, the Old Regime is usually better. If deductions are less, the New Regime wins due to lower slab rates and ₹12L rebate. Salaried individuals with home loans and HRA often benefit from Old Regime. Others should switch to New.

In the New Tax Regime (FY 2025-26), standard deduction is ₹75,000 (increased from ₹50,000 in Budget 2024). In the Old Regime, it remains ₹50,000. The New Regime also offers a rebate making income up to ₹12 lakh effectively tax-free (after standard deduction of ₹75K, taxable income up to ₹12L gets full rebate).

Salaried employees: Yes, you can switch between Old and New regime every financial year when filing ITR. Business/professional income: You can switch only once — if you opt for Old Regime after being in New, you cannot switch back. No prior intimation to employer is needed for switching; choose at ITR filing time.

New Regime does NOT allow: Section 80C (₹1.5L — PF, ELSS, PPF, LIC), HRA exemption, Section 80D (health insurance premium), Home loan interest under Section 24 (₹2L), Section 80E (education loan interest), LTA, 80CCD (NPS extra ₹50K), 80TTA/80TTB (savings interest). Only standard deduction of ₹75K and employer NPS contribution (Sec 80CCD(2)) are available.

Yes, New Tax Regime is the default since FY 2023-24 (AY 2024-25). If you don't explicitly opt for Old Regime, New Regime applies automatically. To choose Old Regime, you must select it when filing ITR. For salaried employees, you can inform your employer for TDS deduction under Old Regime, but final choice is made at ITR filing.