New vs Old Tax Regime: How to Compare Them

Quick answer

Compare the tax payable under both regimes with your actual income and deductions. The lower-tax regime is usually the practical choice, but the answer can change when you have HRA, home-loan interest, 80C, NPS, or other old-regime deductions.

When this matters

This is useful when you want to compare scenarios using your own numbers instead of generic rules. It is designed for Indian households using Niyamfin calculators for private, browser-side estimates.

Key numbers or assumptions

• For AY 2026-27, the Income Tax Department lists the new regime as the default regime for eligible taxpayers, with an option to choose the old regime where allowed.
• The new regime standard deduction for salaried taxpayers is reflected in official Budget/Income Tax guidance.
• Section 87A rebate details are regime-specific and should be checked for the assessment year before filing.

Example calculation

If two people both earn the same salary, the one with high rent/HRA and deductions may still need to compare the old regime carefully. The clean way is to enter income, deductions, HRA, and home-loan details in both calculators before choosing.

Common mistakes

• Choosing the new regime only because it is the default.
• Counting deductions in the new regime that are allowed only in the old regime.
• Ignoring HRA and home-loan interest when those are material.

What to do next

Use the calculator comparison first, then verify the selected regime while filing your return or with a qualified tax professional.