How Income Tax is calculated
Calculate Gross Total Income
Add all income sources: salary, house property, business income, capital gains, and other sources to get your Gross Total Income (GTI).
Claim Deductions
Under the old regime, deduct eligible amounts under 80C (max ₹1.5L), 80D (health insurance), HRA, and other sections to get taxable income.
Apply Tax Slabs
Calculate tax based on applicable slabs. Add 4% Health & Education Cess on the total tax. Surcharge applies if income exceeds ₹50L.
Frequently Asked Questions
The choice depends on your deductions. If your deductions (80C, 80D, HRA, etc.) exceed ₹3-4 lakhs, the old regime may be better. If you have minimal deductions, the new regime with lower slab rates is usually beneficial. Use this calculator to compare both regimes.
Under the new regime for FY 2025-26: 0-3 lakhs: Nil, 3-7 lakhs: 5%, 7-10 lakhs: 10%, 10-12 lakhs: 15%, 12-15 lakhs: 20%, Above 15 lakhs: 30%. Standard deduction of ₹75,000 is available for salaried individuals.
Under the new tax regime for FY 2025-26, salaried individuals get a standard deduction of ₹75,000. This is an increase from ₹50,000 in the previous year. This deduction is automatic and doesn't require any investment.
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