The lower-tax regime depends on income composition and eligible deductions and exemptions. Default status, salary level or one deduction does not establish a universal answer.
Use one period for both calculations
NiyamFin's current calculator models FY 2025-26 / AY 2026-27. It uses that period's slabs, salaried standard deductions, Section 87A treatment and 4% cess. Verify another period separately rather than mixing values.
New regime
The new regime is the default for eligible taxpayers for the modeled period. It uses the applicable Section 115BAC slabs and allows only the deductions expressly retained under that regime.
Old regime
The old regime uses its own slabs and can include eligible exemptions and deductions. Common entries may include a calculated HRA exemption, qualifying Section 80C payments, Section 80D, Section 80CCD and applicable house-property interest. Each has conditions; a statutory limit is not automatically claimable.
Comparison process
- Use the same complete income in both calculations.
- Separate ordinary-rate income from income taxed under special provisions.
- Enter only eligible old-regime exemptions and deductions.
- Enter only provisions available in the new regime.
- Compare final modeled tax, not employer TDS.
- Check filing-specific items omitted by the calculator.
Important limitations
The calculator does not fully model every surcharge, marginal-relief, special-rate, loss-set-off or business-income situation. Taxpayers with business income can also face different regime-switching rules.
Common mistakes
- Choosing the new regime only because it is the default.
- Choosing the old regime merely because deductions exist.
- Using a universal breakeven deduction number.
- Buying investments or insurance to manufacture deductions.
- Treating TDS as final liability.
Use the New vs Old Tax Regime Calculator as a period-specific estimate and verify current rules before filing.
Sources
- Income Tax Department: Salaried individuals, AY 2026-27
- Income Tax Department: New versus old tax regime FAQs
Educational information, not tax advice.