Question 1

Which tax regime is better — Old or New?

Accepted Answer

It depends on your deductions. The New Regime (default from FY 2023-24) has lower slab rates and a higher rebate (up to ₹12L taxable income is tax-free in FY25-26), but disallows most deductions like 80C, HRA, and home loan interest. The Old Regime rewards heavy deductions. The calculator above computes both and recommends the cheaper one for your numbers.

Question 2

What is the standard deduction for FY 2025-26?

Accepted Answer

Salaried individuals get a ₹50,000 standard deduction under the Old Regime and ₹75,000 under the New Regime — automatically applied, no proof required.

Question 3

What is Section 87A rebate?

Accepted Answer

A full tax rebate that makes your tax payable zero. Under the New Regime (FY25-26), it applies up to a taxable income of ₹12,00,000. Under the Old Regime, it applies up to ₹5,00,000 (max ₹12,500 rebate).

Question 4

What deductions are allowed under the New Regime?

Accepted Answer

Very few. Only the standard deduction (₹75K salaried), employer's NPS contribution under 80CCD(2), and a few niche items. Section 80C, 80D, HRA, home loan interest under 24(b), and most other deductions are NOT allowed.

Question 5

How is HRA exemption calculated?

Accepted Answer

HRA exemption = least of (a) actual HRA received, (b) 50% of basic salary (metro) or 40% (non-metro), and (c) rent paid minus 10% of basic salary. HRA exemption is only available under the Old Regime.

Question 6

What is the maximum 80C deduction?

Accepted Answer

₹1,50,000 per financial year. Covers EPF, PPF, ELSS mutual funds, life insurance premium, home loan principal repayment, NSC, 5-year tax-saver FD, Sukanya Samriddhi, and children's tuition fees.

Question 7

What is Section 80CCD(1B)?

Accepted Answer

An additional ₹50,000 deduction for self-contribution to NPS — over and above the ₹1.5L 80C limit. This is one of the most efficient deductions for high earners under the Old Regime.

Question 8

Is employer NPS contribution taxable?

Accepted Answer

Employer's contribution to NPS (up to 10% of basic + DA, or 14% for central govt employees) is deductible under Section 80CCD(2) and is allowed under BOTH the Old and New regimes.

Question 9

How is monthly in-hand salary calculated?

Accepted Answer

In-hand = Gross salary minus employee PF (12% of basic), professional tax (₹200/month in most states), and TDS (monthly tax). The calculator above estimates your monthly take-home for both regimes.

Question 10

What is surcharge on income tax?

Accepted Answer

Additional tax on high incomes: 10% if taxable income > ₹50L, 15% > ₹1Cr, 25% > ₹2Cr, 37% > ₹5Cr (old regime). New regime caps surcharge at 25%.

Question 11

What is Health & Education Cess?

Accepted Answer

A 4% cess on (tax + surcharge), applicable under both regimes. It funds health and education initiatives nationwide.

Question 12

Can I switch between Old and New regime every year?

Accepted Answer

Salaried individuals (no business income) can switch every financial year. Those with business income can switch only once in a lifetime back to the New Regime once they've opted for Old.

Question 13

Does the calculator account for capital gains tax?

Accepted Answer

No — this tool focuses on salary income, deductions, and slab tax. Capital gains (STCG/LTCG on stocks, mutual funds, real estate) are taxed separately and not included here.

Question 14

Is this tax calculator free?

Accepted Answer

Yes, completely free for everyone. No signup required. FundGenie offers free public calculators to help Indian earners plan smarter.

India Income Tax Calculator
FY 2025-26

Old vs New Regime

Salary Breakup

Smart Tax-Saving Suggestions

Detailed Tax Calculation

Old Regime

New Regime

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India Income Tax Calculator FY 2025-26