Income Tax Guide FY 2025-26: Old vs New Regime
The Union Budget 2025 has brought highly beneficial changes to the personal income tax structure in India under the New Tax Regime. Choosing between the Old Tax Regime and the New Tax Regime is an important decision. It requires careful calculation of your gross income, standard deductions, and available investment-linked benefits. Our optimizer helps you make this decision with 100% accuracy based on the latest slabs.
Key Differences (Update 2025)
New Tax Regime (FY 2025-26)
- Lower tax rates and expanded brackets across all slabs.
- Increased standard deduction (₹75,000 for salaried individuals).
- No exemptions or deductions allowed (80C, 80D, HRA, etc.).
- Tax rebate up to ₹12 Lakhs taxable income (Zero tax up to ₹12.75 Lakhs for salaried).
Old Tax Regime
- High deductibility (Section 80C up to ₹1.5L).
- Home loan interest & health insurance benefits.
- Higher marginal tax rates (up to 30%).
- Standard deduction of ₹50,000 only.
New Tax Regime Slabs Comparison (FY 2024-25 vs FY 2025-26)
| FY 2024-25 (Budget 2024) | FY 2025-26 (Budget 2025) | ||
|---|---|---|---|
| Taxable Income Slab | Rate | Taxable Income Slab | Rate |
| Up to ₹3,00,000 | 0% | Up to ₹4,00,000 | 0% |
| ₹3,00,001 - ₹7,00,000 | 5% | ₹4,00,001 - ₹8,00,000 | 5% |
| ₹7,00,001 - ₹10,00,000 | 10% | ₹8,00,001 - ₹12,00,000 | 10% |
| ₹10,00,001 - ₹12,00,000 | 15% | ₹12,00,001 - ₹16,00,000 | 15% |
| ₹12,00,001 - ₹15,00,000 | 20% | ₹16,00,001 - ₹20,00,000 | 20% |
| Above ₹15,00,000 | 30% | ₹20,00,001 - ₹24,00,000 | 25% |
| - | - | Above ₹24,00,000 | 30% |
Confused about which regime to pick?
Our expert Chartered Accountants can help you analyze your specific investment profile to maximize your tax savings for the current financial year.
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