From FY 2023-24, New Tax Regime is default. But many taxpayers benefit from Old Regime with deductions. This complete comparison helps you decide.
| Factor | Old Tax Regime | New Tax Regime FY 2025-26 | Notes |
|---|---|---|---|
| Tax Slabs | Up to ₹2.5L: Nil, 2.5L-5L: 5%, 5L-10L: 20%, Above 10L: 30% | Up to ₹3L: Nil, 3L-7L: 5-10%, 7L-10L: 15%, 10L-12L: 20%, 12L-15L: 25%, Above 15L: 30% | New has more slabs |
| Standard Deduction | ₹75,000 | ₹75,000 | Same since Budget 2024 |
| Section 80C (₹1.5L) | ✅ Available | ❌ Not available | Old regime benefit |
| HRA Exemption | ✅ Available | ❌ Not available | Old regime benefit |
| 80D Health Insurance | ✅ Available | ❌ Not available | Old regime benefit |
| Home Loan Interest (₹2L) | ✅ Available (Section 24b) | ❌ Not available | Old regime benefit |
| NPS Section 80CCD(1B) | ✅ ₹50,000 extra | ❌ Not available | Old regime |
| Rebate u/s 87A | Up to ₹5L taxable — zero tax | Up to ₹7L taxable — zero tax | New regime better |
| Default | No (opt-in needed) | Yes (default from FY 2023-24) | Need to opt old |
| Simplicity | Complex (track all deductions) | Simple (no deductions needed) | New regime easier |
Old Regime better agar: total deductions (80C+HRA+80D+home loan) exceed ₹3.5L-4L+. New Regime better agar: deductions ₹2L se kam, income above ₹15L (lower slab benefit), ya simplicity prefer karo. Use our Income Tax Calculator to compare for your exact numbers.