Enter the deductions you really claim and see which regime costs less for FY 2026-27, plus the exact deduction total you would need for the old regime to win.
The new regime gives you a ₹75,000 standard deduction and lower rates without asking for anything. The old regime makes you earn the difference through deductions — and the bar is higher than it looks, because you are not comparing against zero. You are comparing against a regime that already handed you ₹75,000 and cheaper slabs.
Below the ₹12 lakh rebate ceiling the contest is effectively over: the new regime charges nothing, and no quantity of deductions beats nothing. The decision only becomes live above that, and it turns on how much rent you pay and whether you have a home loan.
| Deduction | Old | New |
|---|---|---|
| Standard deduction | ₹50,000 | ₹75,000 |
| Section 80C — EPF, ELSS, PPF, insurance | ₹1,50,000 | No |
| Section 80D — health insurance | Up to ₹1,00,000 | No |
| HRA exemption, Section 10(13A) | Yes | No |
| Home loan interest, Section 24(b) | ₹2,00,000 | No |
| 80CCD(1B) — your own NPS | ₹50,000 | No |
| 80CCD(2) — employer NPS | Yes | Yes |
That last row is the one people miss. The employer's NPS contribution — up to 14% of salary — is the only meaningful deduction that survives into the new regime. If you are on the new regime, restructuring your package so more flows through employer NPS is the one lever still available, and it costs your employer nothing because it comes out of the same CTC.
Section 87A does not taper. Under the new regime it wipes out the entire liability up to ₹12 lakh of taxable income; a rupee over and the whole bill appears. The old regime has the same structure at ₹5 lakh.
This is worth knowing around appraisal time. A raise that carries you just past either threshold can leave you with less money than before, and the fix — if there is one — is usually to increase a deduction or an employer NPS contribution enough to drop taxable income back under the line.
High earners have a second reason to check both regimes. Surcharge runs at 10% above ₹50 lakh, 15% above ₹1 crore and 25% above ₹2 crore. Above ₹5 crore the old regime charges 37% while the new regime is capped at 25% — a gap large enough to decide the question by itself at that level.
Marginal relief exists so that crossing a surcharge threshold never costs you more in tax than the extra income you earned. This calculator applies it; many quick estimators do not, which is why they overstate the bill just above each threshold.
Salaried people without business income choose afresh each year at filing, so nothing here is permanent and it is worth re-running whenever your rent, home loan or investments change. Anyone with business or professional income gets one opt-out and one return, after which the choice is locked — a much more consequential decision that deserves professional advice.
HRA is usually the deciding deduction — the HRA Calculator shows which of the three tests limits yours, and four more cities became metros from April 2026. For the wider rewrite this sits inside, read what the Income Tax Act 2025 changes, and for what lands in your account each month see CTC vs in-hand salary. Freelancing instead of salaried? Use the Freelancer Tax Calculator. All of it is covered in our India book, Paisa Playbook.