Old vs New Tax Regime Calculator
Compare your tax liability under the New Regime (₹12 Lakh Rebate) vs the Old Regime. Find out exactly how much you can save and how Marginal Relief protects your hard-earned money.
Income & Deductions
Deductions (Applies to Old Regime Only)
* Note: Standard Deduction (₹75K for New, ₹50K for Old) is automatically applied for salaried individuals.
New Regime Tax
Old Regime Tax
Recommendation
The New Tax Regime is better for you. You save ₹0.
Income Distribution (Recommended Regime)
📌 Budget 2026-27: Key Tax Changes
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1.
₹12 Lakh Rebate Limit: Under the New Tax Regime, taxable income up to ₹12 Lakh attracts a full rebate of ₹60,000 u/s 87A, making it completely tax-free.
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2.
₹12.75L For Salaried: Because of the ₹75,000 standard deduction, a salaried individual earning a gross salary of ₹12,75,000 pays absolutely zero tax in the New Regime.
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3.
Marginal Relief Hero: If you earn slightly over ₹12 Lakh (e.g., ₹12.1L), marginal relief ensures your tax penalty doesn't exceed your extra income above the threshold.
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💡 How does Marginal Relief work in 2026-27?
Marginal Relief is a tax safety net. Under the New Tax Regime, if your taxable income is exactly ₹12,00,000, your tax is ₹0 (thanks to the ₹60,000 rebate). However, if your income increases to ₹12,10,000, the rebate vanishes, and the normal tax calculated would suddenly jump to ₹61,500. This means for earning ₹10,000 extra, you pay ₹61,500 in tax!
Marginal relief fixes this anomaly. It restricts your tax payable to the exact amount of income that exceeds ₹12 Lakhs. In the example above, your tax is capped at ₹10,000 (plus 4% cess). This relief is available up to a taxable income of approximately ₹12.7 Lakhs.
⚙️ Old vs New Tax Regime: Which is better?
The New Tax Regime is now the default and is highly beneficial for the majority of taxpayers because:
- It offers a massive ₹12 Lakh zero-tax limit (Rebate u/s 87A).
- It has a higher standard deduction of ₹75,000 for salaried employees.
- It has lower tax slab rates (5%, 10%, 15%, etc.).
The Old Tax Regime is beneficial ONLY if you have heavy deductions. To beat the new regime, you typically need to claim Section 80C (₹1.5L), 80D (Health Insurance), HRA, and Home Loan interest (₹2L) simultaneously. Our calculator compares both instantly so you don't have to guess.