Old vs New Tax Regime Calculator

Old regime vs new regime in short

The new regime is the default. It has lower slab rates, a larger standard deduction for salaried people and a rebate that makes income up to ₹12 lakh of taxable income tax-free, but it allows almost no deductions. The old regime has higher rates but lets you subtract deductions such as 80C (PPF, EPF, ELSS, life insurance), 80D (health insurance), HRA and home loan interest.

The break-even rule

The question is simple: are your deductions big enough to beat the new regime's lower rates? The calculator answers it directly by finding the break-even deductions: the total amount of old-regime deductions at which both regimes cost the same. If your actual deductions are higher, the old regime wins; if lower, stay with the new regime. At many incomes the break-even is well above what most people can claim, which is why the new regime suits the majority.

Who may still benefit from the old regime

• People paying large home loan interest on a self-occupied house (up to ₹2 lakh).
• Those claiming big HRA exemptions in high-rent cities.
• Taxpayers who already use the full 80C, 80D and NPS limits.

Switching rules

Salaried people can choose either regime each year when filing the return. People with business income can switch back from the old regime only a limited number of times, so check before changing. Tell your employer your choice at the start of the year so the right TDS is deducted.

For a detailed slab-by-slab breakdown, use the income tax calculator. Work out your HRA exemption with the HRA calculator and your monthly take-home with the in-hand salary calculator.

A quick example

Enter your salary, then add up your real deductions for the year. If the break-even figure shown is higher than what you can claim, the new regime is cheaper, even if you invest the full ₹1.5 lakh under 80C.