For
the Financial
Year 2025-26 (Assessment Year 2026-27), there are two distinct tax
regimes. The New Tax Regime is the default option
and has been significantly updated with wider slabs and higher exemption limits
compared to previous years.
Here
are the detailed tax slabs for both regimes.
1. New Tax Regime (Default)
This
regime offers lower tax rates but does not allow most deductions (like Section
80C, HRA, etc.).
|
Annual Taxable Income |
Tax Rate |
|
₹0
– ₹4,00,000 |
Nil |
|
₹4,00,001
– ₹8,00,000 |
5% |
|
₹8,00,001
– ₹12,00,000 |
10% |
|
₹12,00,001
– ₹16,00,000 |
15% |
|
₹16,00,001
– ₹20,00,000 |
20% |
|
₹20,00,001
– ₹24,00,000 |
25% |
|
Above
₹24,00,000 |
30% |
Key
Benefits in New Regime (FY 2025-26):
Ø
Tax-Free Income Limit: Individuals with a taxable income of up
to ₹12 Lakh pay zero tax due to the rebate
under Section 87A.
Ø
Standard Deduction: Salaried individuals and pensioners get a
standard deduction of ₹75,000 (increased from ₹50,000).
Ø
Effective Tax-Free Salary: If you are salaried, you can earn up
to ₹12.75
Lakh (₹12L limit + ₹75k
deduction) without paying any income tax.
2. Old Tax Regime (Optional)
This
regime retains the older slab rates but allows you to claim various exemptions
(Section 80C, 80D, HRA, LTA, etc.). You must actively "opt-in" to use
this regime.
|
Annual Taxable Income |
Tax Rate (Non-Seniors) |
Seniors (60-80 yrs) |
Super Seniors (80+ yrs) |
|
Up
to ₹2.5 Lakh |
Nil |
Nil
(up to ₹3L) |
Nil
(up to ₹5L) |
|
₹2,50,001
– ₹5,00,000 |
5% |
5% |
Nil |
|
₹5,00,001
– ₹10,00,000 |
20% |
20% |
20% |
|
Above
₹10,00,000 |
30% |
30% |
30% |
Key
Details for Old Regime:
Ø Standard
Deduction: Remains at ₹50,000 for salaried individuals.
Ø Rebate u/s
87A: Available only for taxable income up to ₹5 Lakh.
Ø Deductions: You can
claim investments (PPF, LIC, ELSS) up to ₹1.5L u/s 80C, health insurance u/s
80D, and Home Loan Interest u/s 24(b).
Summary Comparison (FY 2025-26)
|
Feature |
New Regime (Default) |
Old Regime (Optional) |
|
Basic
Exemption |
₹4,00,000 |
₹2,50,000 |
|
Standard
Deduction |
₹75,000 |
₹50,000 |
|
Tax-Free
Rebate Limit |
₹12,00,000 |
₹5,00,000 |
|
Major
Deductions |
Not
Allowed (No 80C, HRA) |
Allowed
(80C, HRA, etc.) |
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