Old vs New Tax Regime Calculator 2026-27: How Much in Deductions Do You Need?

What the break-even number means

The new regime (section 202 of the Income-tax Act, 2025) has lower rates and a ₹75,000 standard deduction, but it ignores almost every other deduction. The old regime has higher rates and a ₹50,000 standard deduction, and it lets you subtract HRA, investments, insurance and home loan interest. What decides it for you is whether your own deductions are big enough to pay for the old regime's higher rates.

The calculator answers that with one figure: the smallest total of old-regime deductions at which old-regime tax is no more than new-regime tax at your income. Claim more than that and the old regime is cheaper. Claim less and the new one is. The figure does not count the standard deduction, because you get a version of it either way; the ₹25,000 difference between the two is already built in.

The calculation follows the tax rules line by line instead of using a flat rate. That matters around ₹12 lakh, where the section 156 rebate and its marginal relief make the new regime's tax jump from nil, and around ₹50 lakh, where surcharge starts.

Why the number rises, dips, then stays at ₹8 lakh

Up to a salary of ₹12.75 lakh the new regime charges nothing: ₹75,000 of standard deduction takes taxable income down to ₹12 lakh, and the rebate covers the tax on that. To match zero, the old regime has to bring taxable income down to ₹5 lakh, where its own ₹12,500 rebate cancels the tax. That needs deductions of your salary minus ₹5.5 lakh, which is ₹4.5 lakh at ₹10 lakh and ₹7.25 lakh at ₹12.75 lakh.

Just above ₹12.75 lakh the new regime starts charging tax, and marginal relief makes it climb fast: ₹26,000 at ₹13 lakh and ₹74,100 at ₹13.5 lakh. Each rupee of new-regime tax lets the old regime get away with fewer deductions, so the break-even drops to ₹6,87,500 at ₹13 lakh and bottoms out at about ₹5.05 lakh near ₹13.5 lakh. From there it rises slowly again, to ₹5,43,750 at ₹15 lakh and ₹7,08,334 at ₹20 lakh.

Once taxable income is past ₹24 lakh in the new regime, every extra rupee is taxed at 30% in both regimes, so the gap between them stops moving. The two tax curves stay a fixed distance apart and the break-even settles at exactly ₹8,00,000. It stays there until ₹50 lakh, where surcharge starts. Above that the old regime can sometimes win with less, because big deductions can pull old-regime income back under the ₹50 lakh surcharge line.

For senior citizens the old regime's basic exemption is ₹3 lakh instead of ₹2.5 lakh, so above ₹12.75 lakh the break-even is ₹8,333 to ₹12,500 lower (₹7,00,000 at ₹20 lakh, ₹7,91,667 from about ₹25 lakh). For those 80 and above the exemption is ₹5 lakh. The new regime is the same at every age.

Which deductions count, with the new section numbers

Tax year 2026-27 is the first under the Income-tax Act, 2025, so the familiar section numbers changed. The calculator shows both.

• Section 123 (old 80C), up to ₹1,50,000: your EPF contribution, PPF, ELSS, life insurance, home loan principal, children's tuition fees. Your EPF alone often fills a good part of it.
• Section 124 (old 80CCD(1B)): an extra ₹50,000 for your own NPS contribution, on top of section 123.
• Section 126 (old 80D): health insurance, ₹25,000 for yourself and family (₹50,000 if you are 60 or older) and the same again for parents, so at most ₹1,00,000.
• Section 22 (old 24(b)): interest on a loan for a house you live in, up to ₹2,00,000.
• HRA exemption (Schedule III, old 10(13A)): the least of HRA received, rent minus 10% of salary, and 50% or 40% of salary. From 2026-27 the 50% applies in eight cities: Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Pune and Ahmedabad. Use the HRA exemption calculator and type the exempt amount here.
• Professional tax, up to ₹2,500, under section 19.
• Anything else in one box: education loan interest (section 129, old 80E), donations (section 133, old 80G), savings bank interest.

Add the capped amounts, leave out HRA, and the usual ceiling is ₹4,27,500. That is below the break-even at every salary above about ₹9.8 lakh. In practice the old regime pays off mainly for people who pay high rent in a big city, or who have both a home loan and a large HRA claim, or whose income is high enough that deductions drag them under a surcharge threshold.

Two items help in both regimes and so hardly change the answer: your employer's NPS contribution and interest on a let-out property. The calculator leaves them out.

₹13 lakh, ₹18 lakh and ₹30 lakh salaries: which regime?

At ₹13 lakh, new-regime taxable income is ₹12,25,000. Slab tax would be ₹63,750, but marginal relief caps it at the ₹25,000 you earn above ₹12 lakh, so the bill is ₹26,000 with cess. The old regime needs ₹6,87,500 of deductions to match. Full section 123, section 126 at ₹25,000, NPS at ₹50,000, professional tax and an HRA exemption of ₹1,80,000 give ₹4,07,500, and old-regime tax of ₹84,240. The new regime saves ₹58,240. Note that the Income Tax Department's basic online calculator shows ₹66,300 for the new regime at this income, because it does not apply the marginal relief the law gives.

At ₹18 lakh, new-regime tax is ₹1,50,800 and the break-even is ₹6,41,667. Someone who maxes out section 123, NPS, ₹25,000 of health cover, the ₹2 lakh home loan interest and professional tax reaches ₹4,27,500 and pays ₹2,17,620 in the old regime, ₹66,820 more. They would need about ₹2.14 lakh of HRA exemption on top to break even.

At ₹30 lakh, new-regime tax is ₹4,75,800 and the break-even is ₹8,00,000. That usually takes the ₹4.3 lakh of standard deductions plus an HRA exemption of about ₹3.7 lakh, which on a ₹15 lakh basic salary means rent of about ₹44,000 a month or more.

Worked examples

Sources

• Income Tax Department: Tax Reference Tables as per the Income-tax Act, 2025 (tax rates, rebate, surcharge, benefits allowable to employees)
• Income Tax Department: Income & Tax Calculator (e-Filing portal), used for the test runs
• Income Tax Department: utility to check provisions of the Income-tax Act, 1961 against the Income-tax Act, 2025 (section mapping)

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