Income Tax Calculator for FY 2026–27 (AY 2027–28)

How to Use the Income Tax Calculator for FY 2026–27 (AY 2027–28)?

The steps to utilize the tax calculator are as follows:

1. Select the financial year for which you would like your taxes to be computed.

2. Choose your age appropriately. In India, tax obligations vary by age group.

3. Mention your income and deduction details.

4. Click on 'Calculate,' and you'll receive values from both the old and new tax regimes.

5. You can enter '0' in whichever field is not applicable.

Income Tax Slab Rates for FY 2026–27

Below are the applicable income tax slab rates for FY 2026–27 under both the old and new tax regimes.

New Tax Regime (Default)

Note: No income tax is payable on income up to ₹12,00,000 under the new tax regime due to the ₹60,000 rebate available under Section 87A.

For salaried individuals, an additional standard deduction of ₹75,000 raises the effective tax-free limit to ₹12,75,000. However, this rebate does not apply to income taxed at special rates (e.g., capital gains).

Additionally, taxpayers with income slightly above ₹12 lakh may benefit from marginal relief, ensuring the tax payable does not exceed the amount by which income exceeds ₹12 lakh.

Old Tax Regime (Default)

For individuals below 60 years of age:

For resident individuals aged 60 to 80 years (Senior Citizens):

For resident individuals above 80 years (Super Senior Citizens):

Surcharge and Health & Education Cess

If your total income exceeds certain limits, a surcharge is applied to your income tax. The surcharge rates are as follows:

Note: Under the new tax regime, the maximum surcharge rate has been capped at 25%. In addition to income tax and surcharge, a Health and Education Cess of 4% is applied to the total tax liability.

Rebate under Section 87A

If a taxpayer's total taxable income falls within the prescribed limit, they may claim a rebate under Section 87A, which can reduce their income tax liability to zero. The applicable rebate limits for FY 2026–27 are:

*From FY 2026–27 onwards, the rebate is not applicable to income taxed at special rates. The rebate also does not apply to long-term capital gains taxed under Section 112A in any financial year.

Marginal Relief

Marginal relief is available to taxpayers whose income slightly exceeds ₹12,00,000 under the new tax regime. It ensures that the additional tax payable on the income above ₹12 lakh does not exceed the amount by which the income exceeds ₹12 lakh. For example, if your taxable income is ₹12,10,000, the tax payable shall not exceed ₹10,000 (the excess over ₹12 lakh). This provides relief to taxpayers near the rebate threshold.

Example: Calculating Income Tax

Income from salary generally includes Basic Salary, HRA, Special Allowance, Transport Allowance, and other allowances. Certain components may be exempt from tax, such as telephone reimbursements and Leave Travel Allowance (LTA). A standard deduction of ₹50,000 is available under the old regime and ₹75,000 under the new regime.

Sujata earns a basic salary of ₹1,00,000 per month, HRA of ₹50,000 per month, and a special allowance of ₹21,000 per month. She also receives LTA of ₹20,000 per year. She lives in Delhi and pays ₹40,000 rent per month.

Sujata also earns interest income of ₹8,000 (savings account) and ₹12,000 (fixed deposit). Her tax-saving investments are: PPF ₹50,000, ELSS ₹20,000, LIC premium ₹8,000, and medical insurance ₹12,000.

Deductions claimable under the Old Tax Regime:

Old Tax Regime — Tax Liability:

New Tax Regime — Tax Liability:

Deductions and Exemptions Not Permitted Under the New Tax Regime

Individuals or Hindu Undivided Families (HUFs) opting for the new tax regime (Section 115BAC / New Income Tax Act 2025 equivalent) cannot claim the following:

1. Leave Travel Allowance (LTA) under Section 10(5)

2. House Rent Allowance (HRA) under Section 10(13A)

3. Certain special allowances under Section 10(14), except those specifically permitted

4. Allowances for MPs and MLAs under Section 10(17)

5. Minor's income exemption under Section 10(32)

6. Deduction under Section 10AA for SEZ units

7. Entertainment allowance and professional tax deductions under Section 16

8. Interest deduction on housing loan for self-occupied property under Section 24(b)

9. Additional depreciation under Section 32(1)(iia)

10. Deductions under Sections 33AB, 33ABA, 32AD, and 33AC

11. Scientific research deductions under Section 35

12. Deductions under Section 35AD and Section 35CCC

13. Most Chapter VI-A deductions including:

    • Section 80C,

    • 80CCC, 80CCD(1),

    • 80D,

    • 80DD, 80DDB,

    • 80E, 80EE, 80EEA, 80EEB,

    • 80G, 80GG, 80GGA, 80GGC,

    • 80IA and similar.

Note: Losses under 'Income from House Property' for rented properties cannot be set off against other income heads under the new regime, but may be carried forward.

Deductions Still Allowed Under the New Tax Regime

• Standard Deduction of ₹75,000 for salaried employees and pensioners

• Section 80CCD(2): Employer's contribution to the National Pension Scheme (NPS)

• Section 80JJAA: Deduction for new employment generation

• Section 80CCH: Deduction for contributions to the Agnipath Scheme

Allowances Permitted Under the New Tax Regime (Section 10(14))

• Transport allowance for divyang (disabled) employees commuting to work

• Conveyance allowance for expenses during official duties

• Travel expense reimbursements for official tours or transfers

• Daily allowance when an employee is away from their regular place of duty