How the comparison works
The calculator runs your income and deductions through both the old and new regime tax engines simultaneously. The old regime applies your actual deductions (80C, 80D, 24(b), 80E, standard deduction ₹50K cap) to arrive at a lower taxable income but pays higher slab rates. The new regime ignores those deductions (except standard deduction capped at ₹75K) but benefits from lower slab rates starting at 5% from ₹3L and 30% only above ₹15L.
The underlying formula is the same IT Act computation used in the Income Tax Calculator: taxable income → slab tax → 87A rebate → surcharge (with marginal relief) → 4% cess = total tax payable.
Common scenarios
Home loan + 80C filer (old regime usually wins)
If you claim ₹2L Section 24(b) home-loan interest, ₹1.5L Section 80C (PPF/ELSS/EPF/LIC principal), and ₹25K Section 80D health insurance, your total deductions hit ₹3.75L (plus standard deduction). That deduction quantum is large enough that even the old regime’s higher slab rates result in lower total tax for incomes between ₹10L and ₹20L.
Enter your actual numbers above — the break-even varies by income level. At ₹15L with full deductions, the old regime typically saves ₹30K–₹50K per year.
Salaried with no home loan (new regime often wins)
Without 24(b) interest, your maximum deductions in the old regime are roughly ₹2.5L (₹50K standard + ₹1.5L 80C + ₹25K 80D + ₹25K NPS). The new regime’s lower slabs (especially the 10% band at ₹7L–₹10L vs 20% in the old regime) typically make the new regime cheaper. For ₹10L income with no home loan, new regime saves approximately ₹20K.
Incomes below ₹7L (new regime wins almost always)
The new regime’s ₹7L 87A rebate cap means zero tax for most filers below ₹7.75L (₹7L taxable + ₹75K standard deduction). Old regime’s 87A kicks in only up to ₹5L taxable income with a ₹12,500 rebate cap — meaning old regime has a tax liability at lower income levels where new regime is still zero.
Incomes above ₹50L (surcharge planning matters)
At very high incomes, the new regime’s 25% surcharge cap (vs 37% in old regime for income >₹5Cr) becomes the decisive factor. The calculator models this marginal relief correctly. For ₹1Cr+ incomes, run the full calculation with your deductions to see which regime gives lower post-surcharge liability.
Bridges
Your Section 24(b) deduction is the single largest variable in the old vs new regime decision. The Home Loan Tax Benefit Calculator shows you the exact 24(b) interest deduction year-by-year and the net after-tax EMI cost — input that deduction here to see the regime impact.
For Section 80C optimisation: the 80C Deduction Calculator helps you allocate the ₹1.5L cap across PPF, ELSS, LIC, EPF, and home loan principal repayment. Once you know your 80C number, enter it above.
For the full single-regime breakdown with slab-by-slab detail and cess + surcharge line items, use the Income Tax Calculator.
Related glossary entries
- EMI — the home loan EMI determines how much 24(b) interest you pay each year, which is the key input for old regime deduction planning