India Income Tax Calculator: New Tax Regime Slabs & Rebate
Calculate your income tax under India's New Tax Regime for FY 2025-26. Features the ₹75,000 standard deduction, Section 87A rebate, progressive slabs, and marginal relief.
India New Tax Regime Slabs (FY 2025-26 / AY 2026-27)
Under the revised New Tax Regime introduced by the Union Budget, individual income is taxed across standardized progressive slabs:
For deeper analysis and related planning, you can also explore our Tax Refund Calculator and Capital Gains Tax Calculator.
| Taxable Income Slab | Income Tax Rate | Tax Computation in Slab | Cumulative Base Tax |
|---|---|---|---|
| Up to ₹4,00,000 | Nil (0%) | ₹0 | ₹0 |
| ₹4,00,001 to ₹8,00,000 | 5% | 5% of amount exceeding ₹4,00,000 | ₹20,000 |
| ₹8,00,001 to ₹12,00,000 | 10% | 10% of amount exceeding ₹8,00,000 | ₹60,000 |
| ₹12,00,001 to ₹16,00,000 | 15% | 15% of amount exceeding ₹12,00,000 | ₹1,20,000 |
| ₹16,00,001 to ₹20,00,000 | 20% | 20% of amount exceeding ₹16,00,000 | ₹2,00,000 |
| ₹20,00,001 to ₹24,00,000 | 25% | 25% of amount exceeding ₹20,00,000 | ₹3,00,000 |
| Above ₹24,00,000 | 30% | 30% of amount exceeding ₹24,00,000 | ₹3,00,000 + 30% on excess |
Section 87A Rebate & Marginal Relief Explained
The revised tax code offers comprehensive tax exemption for middle-income earners through Section 87A:
- Nil Tax Up to ₹12.75 Lakh Gross Salary: Salaried employees receive an automatic ₹75,000 standard deduction. If your total gross income is ₹12,75,000 or below, your taxable income drops to ₹12,00,000. Under Section 87A, the entire ₹60,000 base tax is credited back as a rebate, resulting in ₹0 Net Tax.
- Marginal Relief Mechanism: If taxable income slightly exceeds ₹12,00,000, marginal relief ensures that tax payable cannot exceed the amount by which income surpasses ₹12 Lakh. For example, on a taxable income of ₹12,02,000, your tax is capped at ₹2,000 plus 4% cess (₹2,080), avoiding an unfair cliff-edge jump.
Salary Tax Benchmarks: Take-Home vs Tax Payable
| Annual Gross Salary | Taxable Income (Less 75k) | Total Tax Payable (incl. Cess) | Effective Tax Rate |
|---|---|---|---|
| ₹10,00,000 | ₹9,25,000 | ₹0 (Rebate Applied) | 0.00% |
| ₹12,75,000 | ₹12,00,000 | ₹0 (Full 87A Rebate) | 0.00% |
| ₹15,00,000 | ₹14,25,000 | ₹97,500 | 6.50% |
| ₹17,00,000 | ₹16,25,000 | ₹1,35,200 | 7.95% |
| ₹20,00,000 | ₹19,25,000 | ₹1,92,400 | 9.62% |
Frequently Asked Questions
How is income tax calculated under the new tax regime?
Gross income is reduced by the flat ₹75,000 standard deduction. The resulting taxable income is taxed in progressive brackets from 0% to 30%, with a full tax rebate up to ₹12 Lakh taxable income.
Is income tax zero for salary up to ₹12.75 Lakh in the new regime?
Yes, for salaried individuals earning up to ₹12,75,000, subtracting the ₹75,000 standard deduction leaves a taxable income of ₹12,00,000, which qualifies for a full Section 87A rebate resulting in ₹0 tax.
How does Section 87A marginal relief work above ₹12 Lakh?
When taxable income slightly exceeds ₹12,00,000, marginal relief caps your total tax at the exact amount exceeding ₹12 Lakhs plus 4% cess, preventing an abrupt tax surge.
What deductions are allowed in the new tax regime?
The new regime allows a ₹75,000 standard deduction for salaried employees and employer NPS contributions under Section 80CCD(2). Common deductions like Section 80C and HRA are not eligible.
How much tax is owed on a ₹15 Lakh salary in the new regime?
On ₹15 Lakh gross salary, taxable income is ₹14,25,000 after the ₹75,000 standard deduction. Total tax payable including 4% cess is ₹97,500, representing an effective rate of only 6.5%.
How much tax is owed on a ₹17 Lakh salary in the new regime?
On ₹17 Lakh gross salary, taxable income is ₹16,25,000. Total tax payable including 4% cess is ₹1,35,200, an effective tax rate of approximately 7.95%.