Income Tax Slabs in India for FY 2025 to 2026

A complete reference for FY 2025 to 2026

Income tax slabs in India change with every Union Budget and currently exist in two parallel structures. This post lays out both regimes for FY 2025 to 2026 in one place: the slabs, the rebate logic, the surcharge thresholds, the cess, and a step-by-step illustration of how tax is actually computed. Use it as a reference whenever you need the exact numbers.

For computing your own tax, the Income Tax Calculator processes both regimes instantly and shows you which one saves more for your specific income and deductions.

New regime slabs for FY 2025 to 2026

The new regime offers broader zero-rate coverage and lower headline rates than the old regime, in exchange for giving up most deductions.

Income up to ₹4 Lakh: 0 percent. ₹4 to ₹8 Lakh: 5 percent. ₹8 to ₹12 Lakh: 10 percent. ₹12 to ₹16 Lakh: 15 percent. ₹16 to ₹20 Lakh: 20 percent. ₹20 to ₹24 Lakh: 25 percent. Above ₹24 Lakh: 30 percent.

A standard deduction of ₹75,000 is available for salaried taxpayers and pensioners. This is applied before the tax on slabs is computed.

Section 87A rebate fully covers the income tax on taxable income up to ₹12 Lakh. Combined with the standard deduction, a salaried employee with gross salary up to ₹12.75 Lakh effectively pays zero income tax under the new regime.

Very few deductions are allowed under the new regime. Employer NPS contributions under section 80CCD(2) up to 10 percent of basic plus DA (14 percent for central government employees) are allowed. The agniveer corpus deduction, standard deduction for family pension, and a few allowances for differently abled employees are the other exceptions. The long list of popular deductions — 80C, 80D, HRA, home loan interest under 24(b), LTA, and others — are all unavailable.

Old regime slabs for FY 2025 to 2026

The old regime maintains its established structure with different exemption limits for different age categories.

For taxpayers below 60: Income up to ₹2.5 Lakh: 0 percent. ₹2.5 to ₹5 Lakh: 5 percent. ₹5 to ₹10 Lakh: 20 percent. Above ₹10 Lakh: 30 percent.

For senior citizens aged 60 to 80: Income up to ₹3 Lakh: 0 percent. ₹3 to ₹5 Lakh: 5 percent. ₹5 to ₹10 Lakh: 20 percent. Above ₹10 Lakh: 30 percent.

For very senior citizens above 80: Income up to ₹5 Lakh: 0 percent. ₹5 to ₹10 Lakh: 20 percent. Above ₹10 Lakh: 30 percent. (The 5 percent slab effectively disappears since the basic exemption itself covers the first ₹5 Lakh.)

A standard deduction of ₹50,000 applies to salaried and pension income. Section 87A rebate covers tax for taxable income up to ₹5 Lakh, capped at ₹12,500 of tax relief.

The old regime continues to allow all traditional deductions: Section 80C (PPF, ELSS, EPF contributions, NSC, home loan principal, life insurance, tuition fees) up to ₹1.5 Lakh. Section 80CCD(1B) for additional NPS contributions up to ₹50,000. Section 80D for health insurance premiums. HRA exemption under 10(13A). Home loan interest under section 24(b) up to ₹2 Lakh for self-occupied property. Section 80E for education loan interest. Section 80G for charitable donations. LTA exemption. Section 80TTA and 80TTB for savings account and fixed deposit interest. And several others.

Surcharge: the additional tax on high income

Surcharge is a percentage levy on the computed income tax (before cess), applied when income exceeds certain thresholds. It is the same computation method under both regimes but the rates differ for very high incomes.

Income above ₹50 Lakh but up to ₹1 Crore: 10 percent surcharge on tax. Above ₹1 Crore but up to ₹2 Crore: 15 percent surcharge. Above ₹2 Crore but up to ₹5 Crore: 25 percent surcharge. Above ₹5 Crore: 37 percent under old regime, 25 percent under new regime (the new regime capped the top surcharge at 25 percent).

Marginal relief ensures that a small income increment above a surcharge threshold does not result in a tax increase that exceeds the income increase. The relief mechanism limits the extra tax to the extra income for the boundary-crossing portion.

Health and education cess

A flat 4 percent cess on the income tax plus surcharge is applied to both regimes at all income levels. The cess funds centrally sponsored health and education schemes. It is not deductible and applies after the section 87A rebate.

The 4 percent cess is the final step: tax on slabs, minus 87A rebate, plus surcharge (if applicable), times 1.04. The result is your total tax payable.

How tax is computed: a step-by-step walkthrough

Step 1: Compute gross total income by summing all income heads — salary, house property, business or profession, capital gains, and other sources.

Step 2: Apply deductions. Under old regime: 80C, 80D, 80CCD(1B), HRA, home loan interest 24(b), and others as applicable. Under new regime: only the limited list noted above.

Step 3: Apply the standard deduction (₹75,000 under new regime, ₹50,000 under old regime for salaried and pensioners).

Step 4: Compute tax slab by slab on the resulting taxable income.

Step 5: Apply 87A rebate if eligible. Under new regime: if taxable income ≤ ₹12 Lakh, entire tax is waived. Under old regime: if taxable income ≤ ₹5 Lakh, tax up to ₹12,500 is waived.

Step 6: Add surcharge if taxable income exceeds ₹50 Lakh.

Step 7: Add 4 percent health and education cess.

The result is the total income tax payable. TDS deducted by your employer through the year should match this number. Any excess TDS is a refund; any deficit requires self-assessment tax payment before filing.

Worked example at ₹10 Lakh gross salary

Salaried employee, below 60, gross salary ₹10 Lakh, no DA.

New regime: Standard deduction ₹75,000 → taxable income ₹9.25 Lakh. Within the ₹12 Lakh rebate limit, so 87A rebate applies. Tax payable: ₹0 plus cess on ₹0 = ₹0.

Old regime with 80C ₹1.5 Lakh, 80D ₹25,000, HRA exemption ₹1 Lakh: Standard deduction ₹50,000 → ₹9.5 Lakh → minus ₹1.5 Lakh 80C → ₹8 Lakh → minus ₹25,000 80D → ₹7.75 Lakh → minus ₹1 Lakh HRA → taxable income ₹6.75 Lakh. Tax: ₹12,500 (5% slab) + ₹35,000 (20% on ₹1.75 Lakh) = ₹47,500. No 87A rebate (taxable income > ₹5 Lakh). Add 4% cess: ₹49,400.

New regime wins by ₹49,400 at this income level.

Worked example at ₹20 Lakh gross salary

New regime: Standard deduction ₹75,000 → taxable income ₹19.25 Lakh. Tax: ₹0 + ₹20,000 + ₹40,000 + ₹60,000 + ₹56,250 (₹2.25 Lakh × 25%) = wait, at ₹19.25 Lakh: ₹0 (first ₹4L) + ₹20,000 (5% on ₹4-8L) + ₹40,000 (10% on ₹8-12L) + ₹60,000 (15% on ₹12-16L) + ₹60,000 (20% on ₹16-19.25L... wait 16-20L = 20%). On ₹16-19.25L = ₹3.25L × 20% = ₹65,000. Total = ₹1,85,000. Plus 4% cess: ₹1,92,400.

Old regime with full deductions (₹75,000 standard + ₹1.5L 80C + ₹50,000 80CCD(1B) + ₹25,000 80D + ₹2L HRA + ₹2L 24(b) home loan): Total deductions = ₹6.25L + ₹75K = ₹7L deductions from ₹20L → taxable income ₹13L. Tax: ₹12,500 + ₹1,00,000 + ₹90,000 (30% on ₹3L) = ₹2,02,500. Plus 4% cess: ₹2,10,600.

New regime saves ₹18,200 at this income with these deductions. With even larger deductions (home loan in a high-value city, extra NPS), the old regime could reverse the advantage.

Worked example at ₹30 Lakh gross salary

New regime: taxable income = ₹30L - ₹75K = ₹29.25 Lakh. Tax: ₹20,000 + ₹40,000 + ₹60,000 + ₹80,000 + ₹1,31,250 (25% on ₹5.25L from ₹20-24L portion = ₹80,000 + on ₹29.25-24L = ₹5.25L × 30%... wait let me redo: ₹4L at 0, ₹4-8L = ₹20,000, ₹8-12L = ₹40,000, ₹12-16L = ₹60,000, ₹16-20L = ₹80,000, ₹20-24L = ₹1,00,000, ₹24-29.25L = ₹1,57,500. Total = ₹4,57,500. Plus 4% cess = ₹4,75,800.

Old regime with same full deductions of ₹7L from above: taxable income = ₹30L - ₹7L = ₹23L. Tax: ₹12,500 + ₹1,00,000 + ₹3,90,000 (30% on ₹13L) = ₹5,02,500. Plus 4% cess = ₹5,22,600.

At ₹30 Lakh, new regime saves ₹46,800 even with substantial deductions. At this income level, deductions of ₹9 to 10 Lakh or more would be needed for the old regime to win.

Advance tax, TDS, and self-assessment tax

Income tax is paid in advance through the year for non-salaried taxpayers. Advance tax is due in four tranches: 15 percent by 15 June, 45 percent by 15 September, 75 percent by 15 December, and 100 percent by 15 March.

Salaried employees have tax deducted at source by their employer each month. They need to pay advance tax only if they have significant non-salary income such as rental income, interest income, capital gains, or freelance earnings beyond a threshold.

Any shortfall between TDS deducted and final tax due must be paid as self-assessment tax before filing the ITR, due by 31 July for most individuals. Excess TDS triggers a refund.

Key dates for the financial year

The income tax return filing deadline for individuals not subject to audit is 31 July of the assessment year. So for FY 2025 to 2026 (1 April 2025 to 31 March 2026), the filing deadline is 31 July 2026.

The belated return deadline (with a late fee) is 31 December 2026. Updated returns can be filed within 2 years of the end of the assessment year with additional tax payment.

Form 16 must be issued by employers to salaried employees by 15 June after the end of the financial year. Form 26AS and AIS (Annual Information Statement) on the income tax portal show all TDS, TCS, and other credits against your PAN.

For detailed regime comparison, the Income Tax Calculator on HazeGrid handles both regimes for FY 2025 to 2026 and is updated with the current slabs, standard deductions, and rebate rules.