Income Tax Calculator: Old vs New Regime
Compare Old vs New Tax Regime and find unclaimed deductions. Tax Year 2026-27 rates (Income-tax Act, 2025).
Income Details
CTC minus employer PF and gratuity (those are not taxable salary). Include any employer NPS contribution.
50% cities: Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune, Ahmedabad
Old-regime basic exemption: ₹2.5L / ₹3L / ₹5L
Existing Deductions
Old 80CCD(2). Deductible in both regimes: up to 14% of basic (new), 10% (old)
Deductible in the old regime only; max ₹2,500
Old Regime
New Regime (s.202) — Tax Year 2026-27
Optimization Opportunities (Old Regime)
| Section | Current | Max Limit | Gap | Action |
|---|
Tax includes 4% cess and surcharge (10% above ₹50L, 15% above ₹1Cr, 25% above ₹2Cr; 37% above ₹5Cr in the old regime only) with marginal relief. Assumes a resident individual with salary income only.
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What is the Tax Savings Optimizer?
The Tax Savings Optimizer is a free income tax calculator that compares your tax liability under both the Old and New tax regimes for Tax Year 2026-27 (the first year under the Income-tax Act, 2025) and tells you which one saves you more money. It also identifies unclaimed deduction gaps under section 123 (old 80C), section 126 (old 80D), section 124(3) (old 80CCD(1B)) and section 22(2) (old 24(b)), so you can see how much more tax you could save by investing in PPF, NPS, ELSS, health insurance, or claiming HRA.
Alongside your tax under each regime, it shows the gap: the difference between what you're claiming now and the maximum allowed under each section. That is useful before you submit your investment declaration, or if you're a freelancer planning deductions before March 31.
How to Use This Tax Savings Calculator
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1
Enter your annual gross salary
Enter your gross salary (CTC minus employer PF and gratuity). Set your basic salary percentage and select your city for the HRA calculation. Choose your age group for the old-regime exemption limit.
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2
Add your deductions
Fill in your actual investments and expenses: EPF contribution, section 123 investments (PPF, ELSS, LIC), health insurance premiums (section 126), your own NPS contributions under section 124(3), employer NPS under section 124(1)/(2), home loan interest under section 22(2), professional tax, and monthly rent for HRA.
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3
Compare Old vs New regime side-by-side
The calculator instantly shows your tax under both regimes with a clear "you save ₹X more" verdict. The regime with lower tax is highlighted as the winner.
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4
Review your deduction gap table
The optimization table shows how much headroom you have under each section. For example, if you've invested ₹80,000 under section 123 (old 80C) but the limit is ₹1.5 lakh, your gap is ₹70,000. Fill that gap before March 31 to reduce your tax further.
Old vs New Regime: The Short Version
The new regime (section 202) has lower slab rates, a ₹75,000 standard deduction and a full rebate up to ₹12 lakh of taxable income, so a salary up to ₹12.75 lakh pays no tax, but it drops HRA, section 123, section 126 and home-loan interest. Above ₹12.75 lakh, the old regime usually needs about ₹6–8.5 lakh of total deductions (including the ₹50,000 standard deduction and HRA) before it wins. For the slab tables, the break-even at each salary and worked examples, read new vs old tax regime: which saves more.
Section 123 (Old 80C) Tax Saving Options (up to ₹1.5 Lakh)
Section 123 read with Schedule XV of the Income-tax Act, 2025 (the old Section 80C) is the most popular tax-saving deduction, with a combined limit of ₹1,50,000 per tax year. It is available only in the old regime. Here are the most common investment options that qualify:
- ELSS Mutual Funds: equity-linked savings scheme with a 3-year lock-in. Returns are market-linked and not guaranteed.
- PPF (Public Provident Fund): 15-year lock-in, currently 7.1% interest (Oct–Dec 2026 quarter, revised quarterly), fully tax-free (EEE status). Safe and government-backed.
- EPF (Employee Provident Fund): your own (employee) EPF contribution counts toward the ₹1.5L limit; the employer's share does not. Most salaried employees already exhaust a significant portion of 80C through EPF alone.
- NPS Tier 1: your contribution qualifies within the ₹1.5L limit plus an additional ₹50,000 under section 124(3) (old 80CCD(1B)), for up to ₹2 lakh in the old regime. An employer contribution under section 124(1)/(2) is deductible on top, in both regimes. An NPS Tier 2 account works differently: for most people, contributions to it get no deduction.
- Tax-Saver FD: 5-year fixed deposit with a bank. Lower returns than ELSS but zero market risk. Interest is taxable.
- Life Insurance Premium, ULIP, Sukanya Samriddhi Yojana (SSY), NSC: also qualify but have specific conditions and lock-in periods.
Health insurance sits outside the ₹1.5 lakh limit. In the old regime, premiums are deductible under section 126 (old 80D): ₹25,000 for self and family (₹50,000 if senior) plus ₹25,000 for parents (₹50,000 if senior), up to ₹1 lakh in all. Buy cover for what your family needs, not for the deduction; this guide on how much health insurance a family needs works through the sum insured.
