Income tax calculator
Tax compared across both available regimes, with the deductions needed for the older one to win.
Tax under the new regime
Estimate$97,500
113,100 less than the other regime
- New regime
- $97,500
- Old regime
- $210,600
- Deductions needed to match
- $150,001
| Gross salary | $1,500,000 |
|---|---|
| Standard deduction, new regime | -$75,000 |
| Taxable income, new regime | $1,425,000 |
| Slab tax | -$93,750 |
| Cess at 4% | -$3,750.00 |
| Tax under the new regime | -$97,500 |
- Cess of 4% is charged on tax plus surcharge, so it multiplies the bill rather than adding a flat amount.
- The old regime cannot match the new one at this income even with the full deduction limit claimed.
The newer regime gives a ₹75,000 standard deduction and wider slabs but few other deductions, so the older one wins only if you claim well over ₹1,00,000.
Side by side
How this is calculated
Rebate thresholds can be cliffs
India charges nothing at all on taxable income at or below ₹12,00,000 under the new regime, but a rupee above brings the full slab table into play from ₹4,00,000 up.
tax = 0 below the threshold, else the full slab tableA cess is charged on the tax, not the income
India adds 4% of tax plus surcharge, so on ₹1,00,000 of tax it is ₹4,000. Applying it to income instead would overstate the bill by an order of magnitude.
Comparing regimes needs a break-even
Where a taxpayer elects between regimes, the answer depends on deductions claimed rather than income. On ₹15,00,000 the old regime needs well over ₹1,50,000 of claims to match the new one, which is the figure this tool solves for.
Worked example: ₹15,00,000 salary with ₹1,50,000 of deductions
| Salary | ₹15,00,000 |
|---|---|
| Deductions | ₹1,50,000 |
| Standard deduction | ₹75,000 new, ₹50,000 old |
|---|---|
| Cess | 4% of tax |
Regime rules and slab structures differ by country. Pick a country above for the system that applies to you.
What this assumes
- Salaried individual under the standard age band.
- Employment income only.
- Deductions within the applicable limit.
- Resident for the full year.
Where this commonly goes wrong
- Where a newer regime is the default, remaining on the older one usually requires an active annual election.
- Deduction limits are absolute, so overlapping claims above the cap give no further relief.
- Surcharges charged on tax rather than income mean crossing a threshold can cost more than the extra income earned.
Questions
How do parallel tax regimes work?
The taxpayer elects between them. India offers a new regime with wider slabs and a ₹75,000 standard deduction, or an old regime with narrower slabs but 80C, 80D and HRA deductions available.
What is a rebate cliff?
A threshold where tax switches on entirely rather than phasing in. Indian taxable income at or below ₹12,00,000 pays nothing under the new regime; above it the full slab table applies from ₹4,00,000 up.
How is a cess different from a tax rate?
It is charged on the tax rather than the income. India levies 4% on tax plus surcharge, so ₹1,00,000 of tax carries ₹4,000 of cess — applying it to income would overstate the bill dramatically.
Related tools
Sources
General estimate based on published Income Tax Department rates for the current period. Not tax advice. Confirm your position with the Income Tax Department or a chartered accountant.
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