Income Tax Calculator

Compare Old vs New regime • FY 2024-25 • Find best option

Income Tax Calculator

Tax
Years

About Income Tax in India

India offers two tax regimes: Old (with deductions) and New (lower rates, minimal deductions). You can choose the regime that minimizes your tax liability each financial year.

Key Points:

  • Financial Year: April 1 to March 31
  • Assessment Year: Following year (FY 2023-24 = AY 2024-25)
  • Tax filing deadline: July 31
  • Both regimes have ₹50K standard deduction
  • Section 87A rebate; saves tax up to ₹25K (new) or ₹12.5K (old)

How Tax is Calculated

Tax Calculation Steps:

Step 1: Calculate Gross Total Income

Step 2: Subtract Exemptions (HRA, LTA, etc.)

Step 3: Subtract Deductions (80C, 80D, etc.) - Old Regime only

Step 4: Apply tax slabs to taxable income

Step 5: Add 4% Health & Education Cess

Step 6: Subtract TDS already paid

Standard Deduction (₹50K) automatically reduces taxable income in both regimes.

Key Insights

💰 Tax Saving Limit

Maximum tax saving through deductions: 80C (₹1.5L) + 80D (₹25-50K) + HLI (₹2L) + NPS (₹50K) = ₹4.25L+. Can save ₹1.5-2L in taxes!

📊 Break-Even Point

For ₹10L income, if deductions > ₹2.5L, old regime wins. For ₹15L income, break-even is around ₹3L in deductions.

🎯 HRA Strategy

Paying ₹20K rent can save ₹50-60K in taxes (old regime). Claim HRA even if living with parents by paying them documented rent!

Did You Know?

📝 Form 16 Importance

Form 16 from employer shows TDS deducted. Verify it matches your calculations. Any mismatch can lead to tax notices. Keep 16A (TDS on other incomes) too!

💡 New Regime Popularity

Despite simpler process, only 25% taxpayers chose new regime in FY 2022-23. Most find old regime with deductions more beneficial.

🏥 Health Insurance Savings

80D allows ₹25K deduction (₹50K if senior citizen). ₹20K premium saves ₹6K+ in taxes, effectively reducing premium cost!

Frequently Asked Questions About Income Tax

The New Regime slabs are: ₹0-3L (Nil), ₹3-7L (5%), ₹7-10L (10%), ₹10-12L (15%), ₹12-15L (20%), and Above ₹15L (30%). The New Regime is now the default tax regime.
As per the July 2024 Budget, the Standard Deduction for salaried individuals in the New Tax Regime has been increased from ₹50,000 to ₹75,000 for FY 2024-25. In the Old Regime, it remains ₹50,000.
In the New Tax Regime, a rebate is available for taxable income up to ₹7 lakh, making the tax zero. Additionally, marginal relief is provided if your income slightly exceeds ₹7 lakh (up to approx ₹7.27L).
Old Regime suits you if your deductions (80C, 80D, HRA, Home Loan Interest etc.) are high. New Regime is simplified and better if you have fewer deductions. For most individuals with income up to ₹7-10L with minimal investments, New Regime is usually more beneficial. Use this calculator to compare!
Surcharge is an extra tax on high income earners: 10% for income >₹50L, 15% for >₹1Cr, and 25% for >₹2Cr. In the New Regime, the maximum surcharge is capped at 25%. In the Old Regime, it can go up to 37% for income >₹5Cr. Marginal relief applies at threshold points.