Income Tax Calculator — New vs Old Regime, FY 2025-26

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Income tax in India: the general guide

How the tax works, what counts as taxable income, and what TDS and advance tax do to your bill.

Income tax is charged on your total income for the year, under India’s income-tax law. For resident individuals there are two parallel systems — the new regime and the old regime — and you pay under whichever gives the lower total. This calculator models both for FY 2025-26 (AY 2026-27) and names the winner; the guide below explains the pieces it uses.

The two regimes at a glance. The new regime charges lower rates but allows almost no deductions: for salaried taxpayers it keeps only the standard deduction. The old regime charges higher rates but lets you subtract 80C investments, the HRA exemption, 80D health premiums, extra NPS and home-loan interest first. The full slab table for AY 2026-27 — every band and rate for both regimes — is on our AY 2026-27 calculator page; it is not repeated here, so there is one authoritative copy.

Standard deduction. If you are salaried, ₹75,000 comes off your income under the new regime and ₹50,000 under the old regime, before any slab is applied. This calculator applies it automatically when you choose the salaried option under Advanced options.

Taxable income. Taxable income is what remains after the standard deduction — and, under the old regime only, after the deductions you enter: Section 80C up to ₹1,50,000, the HRA exemption amount, Section 80D health premiums (up to ₹25,000, or ₹50,000 for senior citizens), extra NPS under 80CCD(1B) up to ₹50,000 and home-loan interest under 24(b) up to ₹2,00,000 for a self-occupied home. Enter your gross annual income from all sources, then add your deductions under Advanced options; if you already know your taxable income, enter it and leave the Advanced fields at 0.

TDS and advance tax. If you are salaried, your employer deducts tax at source (TDS) from each paycheck against your estimated annual bill; other income is typically covered by advance tax paid during the year. Enter the total already paid — TDS plus advance tax — under Advanced options and a line appears showing what is still to pay under each regime; a negative figure means a refund is due. The amount already paid does not change which regime wins, because the same payments count against both.

US federal and state income tax: how the two interact

One income, two tax systems, two returns — and a state figure that must be computed on the state’s own rules.

An individual in the United States files a federal return and, in most states, a state return, on the same income, under two different systems. The federal system applies the seven marginal brackets to taxable income after the standard deduction or itemised deductions, with credits applied to the tax. The state system applies the state’s own brackets to the state’s own definition of taxable income — which usually starts from federal adjusted gross income and then adds and subtracts under state law — with the state’s own standard deduction or exemption, its own credits, and its own treatment of items the federal system treats differently, such as the deduction for state taxes paid and the treatment of municipal bond interest. The two liabilities are independent: the state tax is not a percentage of the federal tax, and a change in the federal return does not automatically change the state return by the same proportion.

The practical consequence is that a single “income tax” figure is meaningless without its jurisdiction. A taxpayer in Texas or Florida, with no state income tax, faces only the federal liability; a taxpayer in California or New York faces both, and the combined marginal rate — the federal rate plus the state rate, less the federal benefit of the state deduction where it applies — is the rate that decides the next dollar’s tax. The calculator on this page models the Indian regime comparison, which is its subject; for a U.S. estimate, the Tax Calculator on this site applies the federal brackets and the state pointers, and the state return itself must be computed on the state’s forms, with the state’s figures for the year. The structure — two systems, two definitions, two returns — is the point, and it is the reason a U.S. tax estimate that quotes only the federal figure understates the bill by the whole of the state tax.

Income tax by country: method and official sources

Every country taxes income on the same shape — income, deductions, brackets, credits — with different contents at every step.

Income tax in every country follows the same shape: total income from the sources the law counts, minus the deductions and allowances the law gives, taxed at the rates the law sets, minus the credits the law allows, with withholding during the year credited against the result. The contents at each step differ completely: what counts as income, which deductions exist, whether the system is individual or household-based, whether capital gains have special rates, and whether the tax is withheld, assessed, or both. The United Kingdom taxes the individual, with a personal allowance and bands, and collects through PAYE withholding with a year-end reconciliation. Canada taxes the individual federally and provincially, with credits rather than deductions doing much of the work. Australia taxes the individual, with the Medicare levy on top and offsets that reduce the tax. Germany taxes the household jointly in the splitting system, with church tax where it applies. The shape is universal; the contents are local, and a comparison between countries must compare the whole shape, not a single rate.

The official source for each country is its own revenue authority — the IRS in the United States, HM Revenue and Customs in the United Kingdom, the Canada Revenue Agency, the Australian Taxation Office — and the figures for the year in question are the only figures that decide a bill. This site’s country content is method plus pointers to those sources, never a table of foreign rates copied into a guide, because the rates change, the thresholds change, and a figure that was right for one year is wrong for the next. A taxpayer with income in two countries must also consider the treaty between them, which decides which country taxes which income and how the double charge is relieved, and the treaty relief must be claimed, with the residence evidence the treaty requires.

Pensions, retirement income, and senior citizens

Pension is salary income; the age bands and the deductions are what change the bill — and they change it under the old regime.

Pension income is taxed as salary income in the year it is received, at slab rates, after the standard deduction, and the commuted portion has its own exemption rules. What changes the bill for a pensioner is not the head — pension is salary, like any salary — but the age-based features that attach to it: under the old regime, the basic exemption is higher for senior citizens and super senior citizens, the health insurance deduction limits are higher, and the interest deduction for savings deposits is more generous. Under the new regime, the slabs are the same at every age, and the 87A rebate cap does most of the work for lower incomes. A pensioner must therefore compare the regimes on the whole return, including the pension, the interest, the house-property interest, and the deductions the old regime allows — and the AY 2026-27 calculator, with its age categories, is the tool for that comparison, because it holds the income constant while the regime changes. The companion guide on HUFs, senior citizens and NRIs sets out the age bands and the comparison in full.

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