How the Income Tax Calculator Works
Select your tax regime — new or old — and enter your gross annual income. Under the old regime, you can also enter deductions such as Section 80C, 80D, HRA exemption and other eligible deductions.
The calculator applies the relevant slab rates to your taxable income (income after deductions and standard deduction), applies the Section 87A rebate if your taxable income falls within the rebate threshold, then adds 4% health and education cess.
The new tax regime is the default under current rules, offering lower slab rates but fewer deductions. The old regime allows deductions like 80C and HRA but has higher slab rates.
Benefits of Using an Income Tax Calculator
- Compare regimes instantly: see your exact tax liability under both the old and new regime side by side, instead of estimating which one saves more.
- Plan deductions in advance: test how much 80C, 80D or HRA investments actually reduce your tax before the financial year ends, while you can still act on it.
- Understand your effective tax rate: see the real percentage of your income going to tax, not just the headline slab rate.
- Avoid surprises at filing time: know roughly what you owe well before ITR season, so there are no last-minute shortfalls.
- Free and instant: get a clear estimate without logging into any tax portal or spreadsheet.
Formula Used
Tax is calculated slab-by-slab on taxable income, a Section 87A rebate is applied where eligible, and 4% cess is added on the resulting tax:
Total Tax = (Slab-wise Tax − Section 87A Rebate) × 1.04- Taxable IncomeGross income minus standard deduction and eligible deductions
- 87A RebateFull tax rebate if taxable income is within the regime's rebate threshold
- Cess4% health and education cess on tax payable after rebate
Example Calculation
Suppose your gross annual income is ₹18,00,000 under the new tax regime, with standard deduction claimed.
- Annual Income₹18,00,000
- RegimeNew Regime
- Standard Deduction₹75,000
- Total Tax Payable ≈ ₹1,50,800 (Effective Rate: 8.38%)
Important Assumptions
- Tax slabs used are for FY 2026-27 (AY 2027-28) — the same slab rates, standard deduction amounts and Section 87A rebate thresholds introduced in the Union Budget 2025 for FY 2025-26. The Union Budget 2026 didn't change them, so they continue to apply for FY 2026-27.
- This calculator doesn't compute surcharge, which applies only to very high incomes, generally above ₹50 lakh, and is mainly relevant for high-net-worth individuals.
- Old regime deductions (80C, 80D) are capped at their statutory limits (₹1,50,000 and ₹1,00,000 respectively) within this calculator.
- This tool provides an estimate only and doesn't constitute tax advice — please consult a chartered accountant for your specific tax filing.
Frequently Asked Questions
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