Finance · Tax · 10 min read
New vs Old Tax Regime 2026 — Which Saves You More?
For FY 2025-26, every salaried Indian must choose between the New Tax Regime (default) and the Old Tax Regime. The wrong choice can cost you ₹20,000–₹1,00,000 in extra tax. This guide tells you exactly which one is better for your income level.
Key Difference in One Line
New Regime: Lower tax slabs, but no deductions (no 80C, no HRA, no standard deduction beyond ₹75,000). Old Regime: Higher base slabs, but you can claim deductions to reduce taxable income significantly.
New Regime Slabs (FY 2025-26)
| Income Slab | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3L – ₹7L | 5% |
| ₹7L – ₹10L | 10% |
| ₹10L – ₹12L | 15% |
| ₹12L – ₹15L | 20% |
| Above ₹15L | 30% |
Standard deduction of ₹75,000 applies under the New Regime from FY 2024-25 onwards.
Who Should Pick Which Regime?
New Regime is better if your total deductions (80C + 80D + HRA + others) are less than ₹3.75 lakh. Old Regime is better if you have significant deductions — especially home loan interest, high 80C investments, and HRA.
Calculate Your Exact Tax
Use our Income Tax Calculator to compare both regimes for your exact income and deductions. It shows you the breakeven deduction amount and which regime saves you more.