Income Tax Calculator (Old Regime)

While the revised new tax regime is now the default tax regime in India, the old tax regime remains available for individuals who can claim substantial itemized deductions. If you pay significant house rent, hold a large home loan, or max out deductions under Chapter VI-A, the old regime may still result in a lower overall tax bill.

The FinToolkit Income Tax Calculator (Old Regime) models the traditional four-tier slab system for Assessment Year 2026-27 (Financial Year 2025-26), factoring in the ₹50,000 standard deduction for salaried taxpayers, Section 80C, Section 80D, HRA exemption, Section 24(b) home loan interest, and the 4% Health and Education Cess.

Old regime tax slab rates for AY 2026-27 (FY 2025-26)

For resident individuals under 60 years of age, the old regime applies the following progressive tax rates:

Senior Citizens (aged 60 to 79): The basic exemption limit is ₹3,00,000.
Super Senior Citizens (aged 80 and above): The basic exemption limit is ₹5,00,000.

Key deductions available under the old regime

The primary reason to choose the old tax regime is the ability to offset gross salary with legitimate deductions:

• Standard deduction (Section 16(ia)): ₹50,000 for salaried employees and pensioners (compared to ₹75,000 in the new regime).
• Section 80C (up to ₹1,50,000): Employee Provident Fund (EPF), Public Provident Fund (PPF), Equity Linked Savings Schemes (ELSS), life insurance premiums, children's school tuition fees, and home loan principal repayment.
• Section 80D (Health insurance): Up to ₹25,000 for self, spouse, and dependent children (₹50,000 if senior citizen), plus an additional ₹25,000 for parents (₹50,000 if parents are senior citizens).
• House Rent Allowance (Section 10(13A)): Exemption on rent paid using the standard three-way minimum formula via the HRA Calculator.
• Home loan interest (Section 24(b)): Up to ₹2,00,000 per year on self-occupied residential property.
• Section 80CCD(1B): Additional voluntary contribution to NPS up to ₹50,000 beyond the 80C ceiling.

Worked tax example under the old regime

Consider an employee earning a gross annual salary of ₹12,00,000 who claims the ₹50,000 standard deduction, full ₹1,50,000 under Section 80C, and ₹25,000 under Section 80D.

Comparison insight: For this same ₹12,00,000 salary, tax under the revised new regime is ₹0 (due to the ₹75,000 standard deduction and Section 87A rebate). Choosing the old regime in this scenario would mean paying ₹1,11,800 in extra tax despite making ₹1,75,000 in deductions.

Breakeven analysis: Old vs New Regime

To make the old regime financially beneficial, your total itemized deductions must exceed a specific breakeven threshold:

• Income up to ₹12.75 Lakh: The new regime is almost always superior because gross income up to ₹12.75 Lakh incurs ₹0 tax. Under the old regime, paying zero tax at ₹12.75 Lakh requires claiming more than ₹7.75 Lakh in deductions, which is impossible for most taxpayers.
• Income of ₹15 Lakh to ₹20 Lakh: You typically need total deductions exceeding ₹3,75,000 to ₹4,25,000 (such as ₹1.5L 80C + ₹50k 80D + ₹2L home loan interest) before the old regime breaks even with the new regime.
• Check both figures side-by-side using the Income Tax Calculator (New Regime).

Frequently asked questions

Can I still choose the old tax regime for FY 2025-26?

Yes. Although the new tax regime is the default option, salaried individuals can opt for the old tax regime at the time of filing their annual ITR (Form 1 or 2).

What is the Section 87A rebate under the old regime?

Under the old regime, Section 87A provides a rebate of up to ₹12,500 for resident individuals whose total taxable income does not exceed ₹5,00,000. If taxable income exceeds ₹5,00,000 by even one rupee, no rebate applies.

Can I claim both HRA and home loan interest in the old regime?

Yes, provided you meet statutory conditions: if you own a home purchased with a loan in one city (or away from your workplace) and live in a rented property for employment purposes, you can claim both HRA exemption and Section 24(b) interest deduction.

How much standard deduction is allowed in the old regime?

The standard deduction under the old regime is ₹50,000 for salaried employees and pensioners. The higher ₹75,000 standard deduction introduced in Budget 2024 applies only to the new tax regime.

Can self-employed professionals switch regimes every year?

Individuals with income from business or profession can switch to the old regime once, but if they ever switch back to the new regime, they cannot opt back into the old regime in subsequent years.

Related tax calculators

• Income Tax Calculator (New Regime) — calculate your tax under the zero-rebate default new regime.
• HRA Exemption Calculator — determine the exact exempt and taxable portions of your house rent allowance.
• In-Hand Salary Calculator — see monthly take-home salary comparisons between regimes.
• Home Loan EMI Calculator — check your annual interest and principal payments for Section 24(b) and 80C deductions.