Income Tax Calculator
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🧾 About Income Tax Calculator
The Income Tax Calculator is a powerful online tool that helps individuals estimate their tax liability based on their income, deductions, HRA, and other inputs. It simplifies the complex tax calculation process and provides clarity on how much tax you owe to the government for a given financial year.
👩👧 What is an Income Tax Calculator?
An Income Tax Calculator is a digital tool that estimates an individual’s tax liability based on inputs like gross income, deductions (under Sections 80C, 80D, etc.), HRA, and other allowances. It helps salaried employees, professionals, and taxpayers plan better and maximize tax savings by understanding how exemptions and deductions affect their total payable tax.
📊 Budget 2025 Updates on Income Tax
👨💼 For Salaried Individuals:
You can switch between the two regimes every financial year.
At the time of filing your Income Tax Return (ITR), you can choose your preferred regime (even if your employer deducted TDS based on a different regime).
There’s no need to file Form 10-IE from AY 2024–25 onwards. You can select the regime directly in your ITR form.
🧾 For Individuals with Business/Professional Income:
You can switch only once.
Once you opt for the New Regime, you cannot go back to the Old Regime unless you permanently cease your business or profession.
You must file Form 10-IE before the due date of ITR to opt in or out.
🔄 Example:
If you’re salaried and opted for the Old Regime in FY 2023–24, but in FY 2024–25 you don’t have many deductions to claim, you can switch to the New Regime for that year to save taxes.
This flexibility allows salaried individuals to evaluate which regime is more tax-efficient each year.
🔍 What is the tax-free income limit in 2025-26?
The tax-free income limit depends on the chosen regime and the individual’s age:
🧮 Under the New Tax Regime (Default Regime for AY 2026-27):
For all individuals (irrespective of age):
✅ Income up to ₹3,00,000 is tax-free.
Additionally:
Rebate under Section 87A is available for total income up to ₹7,00,000, making the effective tax liability NIL in that case.
So, net taxable income up to ₹7,00,000 attracts zero tax due to rebate.
🧮 Under the Old Tax Regime:
| Category | Basic Exemption Limit |
|---|---|
| Individuals below 60 | ₹2,50,000 |
| Senior citizens (60–80) | ₹3,00,000 |
| Super senior citizens 80+ | ₹5,00,000 |
Section 87A Rebate is also available under the old regime for total income up to ₹5,00,000 (not ₹7,00,000 as in the new regime).
In the new regime, income up to ₹7,00,000 is effectively tax-free (due to rebate).
In the old regime, income up to ₹5,00,000 is tax-free (due to rebate).
🧮 How to Use Investawarehub's Online Income Tax Calculator?
✅ How to Calculate Income Tax on Salary?
💼 Applicable Tax Rate as per the New Regime
Applicable Tax Rates Under the New Regime (FY 2025–26 / AY 2026–27)
The New Tax Regime has simplified slabs and is now the default option for taxpayers. It offers lower tax rates but no major exemptions or deductions, except for:
Standard Deduction of ₹50,000 (applicable to salaried/pensioners)
NPS contribution by employer u/s 80CCD(2)
EPF & Gratuity are also exempt (conditions apply)
| Annual Income Range (₹) | Income Tax Rate |
|---|---|
| 0 – 3,00,000 | 0% (Nil) |
| 3,00,001 – 6,00,000 | 5% |
| 6,00,001 – 9,00,000 | 10% |
| 9,00,001 – 12,00,000 | 15% |
| 12,00,001 – 15,00,000 | 20% |
| Above 15,00,000 | 30% |
🟢 Rebate under Section 87A (only for New Regime):
If total taxable income ≤ ₹7,00,000, you get a rebate of ₹25,000
Effective tax payable = ₹0
✅ Example:
If your income is ₹6,90,000 (after standard deduction), your tax is calculated but completely nullified by the rebate — hence zero tax liability.