Income Tax Slab Rates FY 2026-27 (AY 2027-28)#
New Tax Regime (Default)#
The new regime uses a single slab structure for everyone — it does not give senior or super senior citizens a higher exemption limit the way the old regime does.
| Income Range | Tax Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 - ₹8,00,000 | 5% |
| ₹8,00,001 - ₹12,00,000 | 10% |
| ₹12,00,001 - ₹16,00,000 | 15% |
| ₹16,00,001 - ₹20,00,000 | 20% |
| ₹20,00,001 - ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Old Tax Regime (Optional)#
The old regime's rate structure (5% / 20% / 30%) is the same for everyone, but the exemption limit — where the Nil band ends — rises with age.
Below 60 Years#
| Income Range | Tax Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 - ₹5,00,000 | 5% |
| ₹5,00,001 - ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Senior Citizens (60-80 Years)#
| Income Range | Tax Rate |
|---|---|
| Up to ₹3,00,000 | Nil |
| ₹3,00,001 - ₹5,00,000 | 5% |
| ₹5,00,001 - ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Super Senior Citizens (80+ Years)#
| Income Range | Tax Rate |
|---|---|
| Up to ₹5,00,000 | Nil |
| ₹5,00,001 - ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
Key Points#
- Standard Deduction: ₹75,000 (New Regime), ₹50,000 (Old Regime)
- Rebate under Section 156: New Regime — up to ₹60,000 rebate, effectively zero tax up to ₹12 lakh taxable income (₹12.75 lakh for salaried taxpayers after the standard deduction). Old Regime — up to ₹12,500 rebate, zero tax up to ₹5 lakh taxable income.
- Surcharge: 10% (income ₹50L-1Cr), 15% (income above ₹1Cr up to ₹2Cr); above ₹2Cr the old regime adds further slabs up to 37%, while the new regime caps the surcharge at 25% regardless of income.
- Cess: 4% on tax + surcharge (Health and Education Cess)
Worked Example: Old vs New Regime#
Consider a salaried individual (below 60) with ₹15,00,000 gross salary, claiming ₹1,50,000 under Section 80C, ₹25,000 under Section 80D, and ₹2,00,000 home loan interest under the old regime (these old-regime-only deductions aren't available under the new regime):
| New Regime | Old Regime | |
|---|---|---|
| Gross salary | ₹15,00,000 | ₹15,00,000 |
| Standard deduction | −₹75,000 | −₹50,000 |
| 80C, 80D, home loan interest | Not applicable | −₹3,75,000 |
| Taxable income | ₹14,25,000 | ₹10,75,000 |
| Tax before cess (per slabs above) | ₹93,750 | ₹1,35,000 |
| Cess (4%) | ₹3,750 | ₹5,400 |
| Total tax | ₹97,500 | ₹1,40,400 |
In this case, the new regime works out cheaper despite the old regime's deductions, because the new regime's wider slabs and lower rates outweigh ₹3,75,000 of exemptions at this income level. The crossover point depends heavily on how much you can actually claim under the old regime — a taxpayer with a larger home loan, HRA claim, and full 80C/80D utilisation can still come out ahead on the old regime. There's no universal answer; run your own numbers.
Which Regime Should You Choose?#
- New regime tends to win when you have few deductions to claim — no home loan, minimal 80C investment, no HRA (self-owned home or living with family).
- Old regime tends to win when you have substantial claimable deductions — a home loan with meaningful interest outgo, HRA on real rent paid, full 80C utilisation (EPF, life insurance, ELSS), and health insurance premiums under 80D.
- Business income taxpayers (not salaried) face a restriction: switching between regimes isn't unlimited the way it is for salaried individuals — confirm your specific switching eligibility with your CA before assuming you can change every year.
Rather than estimate, use our Income Tax Calculator with your actual numbers, or the dedicated Old vs New Regime Calculator to compare both side by side.
Frequently Asked Questions#
Is the new tax regime compulsory? No — it's the default regime if you don't actively choose otherwise, but individuals (salaried or otherwise) can opt for the old regime instead when filing, subject to the switching rules that apply to business income taxpayers noted above.
Can I switch regimes every year? Salaried individuals with no business income can choose either regime each year when filing. Individuals with business or professional income have a more restricted ability to switch back and forth — this is worth confirming with your CA if it applies to you.
Does the ₹12 lakh "zero tax" rebate mean income up to ₹12 lakh is tax-free? Not exactly — it means the rebate under Section 156 offsets the computed tax fully at that income level under the new regime, resulting in zero net tax payable. Cross a rupee above the rebate threshold and the calculation changes; it isn't a blanket exemption on the first ₹12 lakh at every income level.
Which deductions are completely unavailable under the new regime? Section 80C, 80D (beyond employer-paid health premiums in some cases), home loan interest on a self-occupied property, HRA, and most Chapter VI-A deductions are not available under the new regime — only a small set of exceptions (like employer's NPS contribution) carry over. Confirm the current exception list with your CA since coverage nuances exist.
Key Takeaways#
- New regime: wider slabs, no deductions, effectively zero tax up to ₹12 lakh taxable income (₹12.75 lakh for salaried) via the Section 156 rebate.
- Old regime: narrower slabs with higher rates, but full access to 80C/80D/HRA/home-loan-interest deductions and age-based exemption limits.
- The better choice depends entirely on how much you can actually claim under the old regime — compute both rather than assuming.
- Business-income taxpayers face restrictions on switching regimes year to year; salaried individuals generally don't.