Use our New Regime vs Old Regime Tax Calculator to instantly compare your tax liability. Get clarity on which income tax regime is more beneficial in 2025-26 with updated slabs, exemptions, and deductions.
New Regime vs Old Regime Tax Calculator
| Head | Details/ Amt. |
|---|---|
| Gross Income | |
| Exemptions u/s 10 A (HRA etc.) | |
| Professional Tax | |
| Net Income under Salaries | 0.00 |
| Standard Deduction (Auto Applied) | 50000 |
| Deductions u/s 80 C (PF, PPF, Ins, ELSS, NPS: Max Rs.150000) | |
| Deductions u/s 80 CCD (NPS: Max Rs. 50000/-) | |
| Deductions u/s 80 D (Health Insurance: Max Rs. 35000/- ) | |
| Deductions u/s 80 G (Eligible Donations) | |
| Deductions u/s 80 E (Education Loan Interest) | |
| Deductions u/s 80 TTA (FD/Post Office Interest: Max Rs. 40000/-) | |
| Tax Benefit u/s 24 (Home Loan Interest Paid: Max Rs. 200000/-) | |
| Total Deductions/Benefits | 0.00 |
Confused About Tax Regimes? You’re Not Alone
Ever since the Government of India introduced the New Tax Regime in Budget 2020 and revised it significantly in Budget 2023, salaried individuals and taxpayers across income brackets have been stuck at a familiar crossroads—Old Regime or New Regime? Which one actually saves more money? Which is right for your income structure? And most importantly, how do you decide without guessing?
In this guide, you’ll not only get a side-by-side comparison of both tax regimes for t
he current financial year (FY 2024–25), but also gain access to a smart, user-friendly tool—the New Regime vs Old Regime Tax Calculator—that instantly helps you determine which regime offers better tax benefits based on your unique income and deductions.
Before you rush to file your Income Tax Return (ITR), this article will walk you through updated tax slabs, key changes, pros and cons, and real-world examples tailored to your situation. Let’s dive in.
Understanding the Basics – Old vs New Tax Regime
What is the Old Tax Regime?
The Old Tax Regime has been in place for decades and allows taxpayers to reduce their taxable income through a wide range of deductions and exemptions. Common ones include:
- Section 80C (Investments like LIC, ELSS, PPF, etc.)
- House Rent Allowance (HRA)
- Leave Travel Allowance (LTA)
- Section 80D (Medical insurance)
- NPS Contributions
- Interest on Home Loans (Section 24)
Under this system, if you're a smart planner or someone with significant eligible investments or housing loans, you can often bring down your tax liability considerably.
However, the trade-off is complexity—filing under the old regime requires documentation, proofs, and a good understanding of multiple tax-saving options.
What is the New Tax Regime?
The New Tax Regime, on the other hand, was introduced to simplify the tax process. It offers reduced slab rates but eliminates the majority of exemptions and deductions.
This means you can't claim benefits under 80C, HRA, LTA, or even on housing loan interest. What you get instead is lower tax rates and a straightforward structure—ideal for those who don’t invest much in tax-saving schemes or prefer a no-fuss filing experience.
Since FY 2023–24, the new regime has been made the default regime by the government, unless the taxpayer explicitly opts for the old one while filing their ITR.
For the latest legal framework and policy references, you may consult the official Income Tax Department Portal and this update on Union Budget 2023 highlights by PIB.
Income Tax Slabs for FY 2024–25: A Comparison
Tax slabs differ significantly under the two regimes. Here's a side-by-side view of the current applicable rates:
New Tax Regime Slabs (FY 2024–25)
| Annual Income | Tax Rate (New Regime) |
|---|---|
| Up to ₹3 lakh | Nil |
| ₹3 – ₹6 lakh | 5% |
| ₹6 – ₹9 lakh | 10% |
| ₹9 – ₹12 lakh | 15% |
| ₹12 – ₹15 lakh | 20% |
| Above ₹15 lakh | 30% |
Standard Deduction: ₹50,000 (Available to salaried taxpayers)
Rebate under Section 87A: Up to ₹25,000 for income up to ₹7 lakh (zero tax liability if income ≤ ₹7 lakh)
Old Tax Regime Slabs (FY 2024–25)
| Annual Income | Tax Rate (Old Regime) |
|---|---|
| Up to ₹2.5 lakh | Nil |
| ₹2.5 – ₹5 lakh | 5% |
| ₹5 – ₹10 lakh | 20% |
| Above ₹10 lakh | 30% |
Available Deductions:
- Standard Deduction (₹50,000)
- 80C (Up to ₹1.5 lakh)
- 80D, 80CCD(1B), HRA, LTA, and others
Rebate u/s 87A: Same as new regime, applicable if total income is below ₹5 lakh
These slabs are applicable for individual taxpayers below 60 years. Senior citizens and super senior citizens have slightly relaxed slabs under the old regime, but not under the new one.
New Regime vs Old Regime Tax Calculator – Try It Before You Decide
Choosing the right regime isn’t just about the slab rates. It depends on your income structure, eligible deductions, and investment habits. A professional earning ₹12 lakh annually with no major deductions might pay less under the new regime. But a salaried person with ₹2.5 lakh in tax-saving deductions may benefit more from the old one.
To avoid any guesswork, use the New Regime vs Old Regime Tax Calculator to compare your liability under both systems instantly.
The calculator asks for:
- Gross salary or income
- Total eligible deductions
- HRA, home loan, and Section 80 investments (if any)
It then generates a real-time comparison of your tax under both regimes, helping you make an informed, data-backed decision.
Factors to Consider Before Choosing Between the Regimes
When it comes to picking between the old and new tax regimes, a single rule doesn’t fit everyone. The most reliable way to determine which one works for you is by using a reliable New Regime vs Old Regime Tax Calculator, but to understand why a certain regime benefits you, consider these critical factors:
1. Income Structure & Salary Components
Your salary breakup plays a major role. If your package includes tax-exempt components like HRA (House Rent Allowance), LTA (Leave Travel Allowance), or performance bonuses that are partially exempt, the Old Regime may give you more room to reduce taxable income.
However, if you draw a consolidated salary without layered exemptions or flexible benefits, the New Regime may be simpler and potentially more economical.
2. Tax-Saving Investments & Deductions
If you’re someone who makes full use of the ₹1.5 lakh limit under Section 80C through EPF, PPF, ELSS, or life insurance premiums, and also claim additional deductions like:
- ₹25,000 – ₹75,000 under Section 80D (Health Insurance)
- Up to ₹2 lakh under Section 24(b) (Home Loan Interest)
- ₹50,000 under Section 80CCD(1B) (NPS Contribution)
Then the Old Regime might be more tax-efficient.
In contrast, taxpayers who do not invest significantly in these instruments or are in early career stages with minimal deductions may benefit from the flat-rate New Regime.
3. Lifestyle & Financial Priorities
Tax planning shouldn’t be done in isolation—it should align with your overall financial goals. For instance:
- Are you planning to buy a house in the near future?
- Do you contribute regularly to long-term investments like NPS or PPF?
- Do you have a dependent family member or education expenses?
Such factors can tilt the balance in favour of the Old Regime, which rewards long-term, tax-saving behaviour.
Those preferring liquidity and simplicity, without locking funds in tax-saving schemes, may lean towards the New Regime.
4. Income Level: Low, Middle, or High
Let’s simplify this with an income-wise overview of regime suitability:
| Income (Annual) | Likely Better Option | Reason |
|---|---|---|
| ₹5 lakh or less | New Regime | Zero tax due to Section 87A rebate |
| ₹6–8 lakh | Depends | Small deductions may tilt towards New |
| ₹9–12 lakh | Old Regime | If claiming over ₹2.5 lakh in deductions |
| ₹15 lakh+ | Depends | If no major deductions – New regime is easier |
Note: Always verify your case with a New Regime vs Old Regime Tax Calculator to get a personalized result.
5. Frequency of Filing & Switching
One practical benefit of the New Regime is simplicity. No document proofs, no investment declarations, and quicker ITR filing. This appeals to freelancers, consultants, and early-career professionals.
However, salaried individuals can switch regimes every financial year while filing ITR, offering flexibility to plan year-on-year.
Taxpayers with business income, however, are restricted to one switch in a lifetime, as per the Income Tax Act provisions. More details can be found on the official Income Tax India site under section 115BAC regulations.
Real-Life Scenarios: Which Regime Saves More?
To make your decision easier, let’s look at actual income scenarios and compare tax liabilities under both regimes. These examples assume common deductions available to salaried taxpayers under the Old Regime.
| Particulars | Case 1: ₹7L Income | Case 2: ₹10L Income | Case 3: ₹15L Income |
|---|---|---|---|
| 80C Investment | ₹1.5L | ₹1.5L | ₹1.5L |
| 80D (Medical Insurance) | ₹25K | ₹25K | ₹50K |
| Standard Deduction | ₹50K | ₹50K | ₹50K |
| Home Loan Interest (Sec 24) | Nil | ₹1.5L | ₹2L |
| Old Regime Tax Payable | ₹0 | ₹45,240 | ₹1,48,200 |
| New Regime Tax Payable | ₹0 | ₹54,600 | ₹1,56,000 |
| Better Option | New Regime | Old Regime | Old Regime |
Note: These examples are approximations and should be verified with an updated New Regime vs Old Regime Tax Calculator like the one available on HR Calcy.
Pros and Cons of Old vs New Tax Regime
While tools like the New Regime vs Old Regime Tax Calculator help you determine tax savings, understanding the core advantages and drawbacks of both systems can assist in making a more strategic choice. Each regime serves different financial profiles and tax behaviours.
Comparison at a Glance
| Feature | Old Tax Regime | New Tax Regime |
|---|---|---|
| Deductions & Exemptions | Available (80C, 80D, HRA, etc.) | Not available (except standard deduction) |
| Tax Filing Complexity | High | Low |
| Standard Deduction | ₹50,000 | ₹50,000 |
| Flexibility | Favors tax planners and investors | Favors individuals with fewer deductions |
| Rebate under Section 87A | Up to ₹12,500 for income ≤ ₹5 lakh | Up to ₹25,000 for income ≤ ₹7 lakh |
| Ideal For | Those with eligible deductions | Those with simple income structure |
| Filing Requirement | Requires proof/documentation | Minimal documentation |
| Default System (from FY 2023) | Not default | Default regime |
Advantages of the Old Regime
- Wide range of deductions allows significant tax planning.
- Suitable for individuals with housing loans, insurance, PPF, ELSS investments.
- Offers flexibility and rewards long-term financial discipline.
- Greater rebate benefit for those earning above ₹5 lakh and utilizing deductions.
Disadvantages of the Old Regime
- Complex to navigate with multiple sections and exemptions.
- Requires investment proof submissions and declaration to employer.
- Missed deductions can lead to higher-than-expected tax.
Advantages of the New Regime
- Simplified process – no need to track or submit investment proofs.
- Transparent and quick tax computation.
- Ideal for gig workers, freelancers, consultants, or first-job individuals.
Disadvantages of the New Regime
- No exemptions under 80C, 80D, or HRA, making it less rewarding for planners.
- Potentially higher tax outgo if deductions are not utilized under old regime.
- Only a few exemptions like standard deduction and NPS employer contribution are allowed.
Government Announcements & Key Updates for FY 2024–25
The Government of India has made pivotal changes to the personal income tax system through the Union Budget 2023, many of which are applicable for FY 2024–25.
Here’s what you should know:
- New Regime is now the default regime for individuals and HUFs unless the old regime is chosen during ITR filing.
- The standard deduction of ₹50,000 is now available under both regimes.
- Rebate under Section 87A increased to ₹25,000 under the new regime, providing zero tax liability for income up to ₹7 lakh.
- Surcharge on income above ₹5 crore under new regime reduced to 25% from 37%.
- Employers are required to ask employees at the beginning of the year to choose their preferred regime.
All of these changes are explained in detail in the Union Budget 2023–24 Highlights and the CBDT Circular No. 04/2023.
These updates have significantly shifted the landscape in favour of the new regime for many middle-income earners. Still, whether it saves you more depends entirely on your personal financial behaviour—something you can evaluate easily using a reliable New Regime vs Old Regime Tax Calculator.
Tools & Resources to Help You Decide
While understanding tax slabs and deduction policies is crucial, having access to accurate tools can simplify your decision-making process drastically. The right resource can eliminate confusion and help you make a financially sound choice between the two regimes. That’s where the New Regime vs Old Regime Tax Calculator becomes indispensable.
HR Calcy’s Income Tax Regime Comparison Tool
One of the most reliable and updated tools available online is the New Regime vs Old Regime Tax Calculator from HR Calcy. It lets you:
- Enter your gross annual income
- Input total deductions (like 80C, 80D, HRA, etc.)
- Include exemptions such as standard deduction or home loan interest
- Instantly view your tax liability under both regimes side-by-side
The results are displayed with clarity, enabling you to confidently decide which regime aligns with your income profile.
Official Income Tax Portal Tools
For those who prefer using government sources, the official Income Tax e-Filing Portal also offers return filing options with built-in calculators for new and old regimes.
Although not as user-friendly as third-party tools, it’s useful for final validation before submission of ITR.
List of Deductions Available Only in the Old Regime
To help you understand whether you can truly benefit from the old regime, here’s a snapshot of deductions and exemptions not allowed under the new regime:
| Section | Description | Maximum Limit |
|---|---|---|
| 80C | Investments in LIC, PPF, ELSS, etc. | ₹1,50,000 |
| 80D | Health Insurance Premium | ₹25,000 – ₹1,00,000 |
| 24(b) | Interest on Housing Loan | ₹2,00,000 |
| 80CCD(1B) | NPS Additional Contribution | ₹50,000 |
| HRA | House Rent Allowance (Conditions apply) | Variable |
| LTA | Leave Travel Allowance | As per employer policy |
These exemptions cumulatively reduce a significant portion of taxable income for many taxpayers. Hence, if you actively claim even half of these benefits, it is advisable to cross-check using a New Regime vs Old Regime Tax Calculator before choosing your path.
Tax Filing Made Simpler Under the New Regime
One of the strong arguments in favour of the new regime is ease of compliance. Many individuals, especially freelancers and young professionals, don’t always invest in tax-saving instruments or own houses. The new regime helps them save time and avoid paperwork.
Moreover, under the Rationalisation of Income Tax Provisions, it’s now clarified that individuals who do not explicitly opt out of the new regime while filing will be defaulted to it.
That’s another reason it is now critical to actively use a verified New Regime vs Old Regime Tax Calculator each year before submitting your return, especially if your deduction structure changes.
Additional Tools to Support Tax Planning
Here are a few more digital tools and platforms that can assist in holistic tax management:
- NSDL Tax Information Network – For TDS, PAN and Form 26AS checks
- TRACES Portal – To download Form 16/16A and TDS details
- RBI’s Tax Payment Guide – For online challan and e-payment process
All of these can supplement your regime decision process, but the most immediate clarity always comes from simulating both outcomes via a trusted New Regime vs Old Regime Tax Calculator.
Final Verdict – Which Tax Regime Should You Choose?
The decision between the old and new tax regimes isn't always straightforward. It depends on your personal financial situation, your ability (and intent) to invest in tax-saving instruments, and your lifestyle preferences.
Use this decision matrix as a guiding summary:
| Scenario | Suggested Regime |
|---|---|
| Salaried, claiming deductions above ₹3 lakh | Old Regime |
| Young professional with no tax-saving investments | New Regime |
| Business owner with frequent income changes | Based on projection |
| Senior citizen with no loans or deductions | Old Regime |
| Freelancer with no structured salary or HRA | New Regime |
To make a confident, data-driven choice, use the New Regime vs Old Regime Tax Calculator before filing your return. Even a small difference in deductions can lead to a notable shift in tax liability.
Conclusion
Navigating between two parallel tax systems may seem overwhelming, but with the right understanding and tools, it can be managed with clarity. The new tax regime offers convenience and lower slab rates, while the old regime rewards methodical planning and long-term investments.
Your best bet? Run your numbers through a New Regime vs Old Regime Tax Calculator, compare the results, and choose the option that supports your financial goals—not just for the current year, but for your future as well.
For accurate ITR filing and clarity on deduction limits, refer to official documents such as the CBDT’s Circulars and annual updates from the Ministry of Finance.
Make your move wisely—and don’t let confusion cost you money.
FAQ
Which tax regime is better in FY 2024–25?
There is no fixed answer. It depends on your income level, deduction eligibility, and personal financial goals. Use a reliable New Regime vs Old Regime Tax Calculator to get accurate results before filing.
Is the new tax regime compulsory now?
From FY 2023–24 onwards, the new regime is set as the default option. However, taxpayers can still opt for the old regime during ITR filing if they prefer.
Can I switch regimes every year?
Yes, salaried individuals can switch between the old and new regimes every year. However, business income taxpayers can switch only once in a lifetime, as per Section 115BAC.
Do senior citizens get any benefit under the new regime?
No, unlike the old regime which offers higher exemption limits for senior and super senior citizens, the new regime applies the same slabs to all individuals regardless of age.
What happens if I don’t declare my regime preference to my employer?
If you don’t inform your employer, your TDS will be deducted as per the default new regime. However, you can still switch to the old regime while filing your ITR.
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