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Compare your tax liability under both regimes for FY 2024-25 and find out which one saves you more money.
The New Tax Regime is now the default regime. If you want to opt for the Old Regime, you must explicitly inform your employer or select it while filing your ITR.
| Component | Old Regime | New Regime |
|---|---|---|
| Gross Salary | ₹12,00,000 | ₹12,00,000 |
| Total Deductions | -₹2,25,000 | -₹75,000 |
| Taxable Income | ₹9,75,000 | ₹11,25,000 |
| Base Tax | ₹1,07,500 | ₹68,750 |
| Cess (4%) | ₹4,300 | ₹2,750 |
| Total Tax Payable | ₹1,11,800 | ₹71,500 |
If you have high investments in 80C, 80D, and Home Loan, the Old Regime might still be better for you. However, for those with fewer investments, the New Regime with its lower slabs and higher standard deduction (₹75,000) is often more beneficial.
India currently has two tax regimes. The Old Regime allows for various deductions and exemptions, while the New Regime offers lower tax rates but removes most deductions.
Best for those with high home loan interest, high HRA, and full 80C/80D utilization.
Best for those who prefer simplicity, lower tax rates, and don't want to lock money in long-term investments.
Salaried individuals can switch between the Old and New regimes every year at the time of filing their ITR. However, those with business income can only switch once in their lifetime.
Yes. For FY 2024-25, it is ₹50,000 in the Old Regime and ₹75,000 in the New Regime.
The New Tax Regime is the default. If you don't specify, your tax will be calculated based on the New Regime.
No, most deductions under Chapter VI-A (like 80C, 80D, 80G) are not available in the New Tax Regime.