Budget 2026 left the income tax slabs unchanged, so FY 2026-27 (the 2026-27 tax year under the new Income-tax Act) uses the same rates as last year. Under the new regime, income up to ₹12 lakh is effectively tax-free — ₹12.75 lakh for salaried people. Here are…
| Taxable income | Rate |
|---|---|
| Up to ₹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% |
| Taxable income | Below 60 | 60 to 79 | 80 and above |
|---|---|---|---|
Up to ₹2,50,000 | Nil | Nil | Nil |
₹2,50,001 – ₹3,00,000 | 5% | Nil | Nil |
₹3,00,001 – ₹5,00,000 | 5% | 5% | Nil |
₹5,00,001 – ₹10,00,000 | 20% | 20% | 20% |
Above ₹10,00,000 | 30% | 30% | 30% |
The old regime gives a rebate of up to ₹12,500 (no tax up to ₹5 lakh), a ₹50,000 standard deduction, and the familiar deductions: 80C, 80D, HRA and home-loan interest.
| Income | Surcharge (new regime) | Surcharge (old regime) |
|---|---|---|
₹50 lakh – ₹1 crore | 10% | 10% |
₹1 crore – ₹2 crore | 15% | 15% |
₹2 crore – ₹5 crore | 25% | 25% |
Above ₹5 crore | 25% (capped) | 37% |
A 4% health and education cess is added on top of tax plus surcharge in both regimes.
| Gross salary | Taxable after ₹75,000 | Tax |
|---|---|---|
₹10,00,000 | ₹9,25,000 | Nil (rebate) |
₹12,75,000 | ₹12,00,000 | Nil (rebate) |
₹15,00,000 | ₹14,25,000 | ₹93,750 + cess = ₹97,500 |
₹25,00,000 | ₹24,25,000 | ₹3,07,500 + cess = ₹3,19,800 |
How the ₹15 lakh example works: ₹20,000 (5% on ₹4–8 lakh) + ₹40,000 (10% on ₹8–12 lakh) + ₹33,750 (15% on the ₹2.25 lakh above ₹12 lakh) = ₹93,750. Add 4% cess of ₹3,750 and the tax is ₹97,500. Marginal relief doesn't apply here, because the tax is well below the income above ₹12 lakh.
Work out your own figures, including PF and take-home pay, with our salary calculator or the income tax calculator.
| Income or taxpayer | Rate |
|---|---|
| Short-term capital gains on listed shares and equity funds | 20% |
| Long-term capital gains on listed shares and equity funds | 12.5% above ₹1.25 lakh a year |
| Lottery, game show and online game winnings | 30% |
| Crypto and other virtual digital assets | 30%, with no deduction except cost |
| Partnership firms and LLPs | 30% flat |
| Domestic companies (concessional regime) | 22% plus 10% surcharge and cess (about 25.17%) |
A HUF uses the same slabs as an individual below 60. Special-rate income is taxed separately from the slabs, and the ₹12 lakh rebate doesn't cover it.
Our comparison of the old vs new tax regime works through the break-even. If you have income beyond salary, also check whether you need to pay advance tax. Want it done for you? TaxQue's income tax return filing service compares both regimes before filing.
This article is published by TaxQue (ARB FinTech LLP) for general informational, educational, and business guidance purposes only. Tax laws, GST rules, MCA circulars, and judicial precedents are subject to frequent statutory revisions. This content does not constitute formal individualized tax, accounting, or legal counsel.
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