What is the income tax exemption limit for FY 2025-26?+
Under the New Tax Regime FY 2025-26: No tax up to ₹7 lakh income due to Section 87A rebate (up to ₹25,000). With ₹75,000 standard deduction, effectively zero tax up to ₹7.75 lakh for salaried individuals. Under Old Tax Regime: Basic exemption is ₹2.5 lakh (₹3 lakh for senior citizens above 60).
Which is better — old or new tax regime?+
New regime is better if: You have fewer deductions/investments, your income is below ₹15 lakh, or you prefer simplicity. Old regime is better if: You claim HRA, have 80C investments (₹1.5L), home loan interest (₹2L), and NPS contributions — total deductions exceed ₹3.75 lakh. Use this calculator to compare both regimes for your specific situation.
What is Section 87A tax rebate?+
Section 87A provides a tax rebate of up to ₹25,000 for taxpayers under the new regime with total income up to ₹7 lakh, and up to ₹12,500 under the old regime for income up to ₹5 lakh. This means if your tax liability is ₹25,000 or less under the new regime, you pay zero tax.
What are the new income tax slabs for FY 2025-26?+
New Tax Regime FY 2025-26 slabs: ₹0–₹3L = 0%, ₹3–₹7L = 5%, ₹7–₹10L = 10%, ₹10–₹12L = 15%, ₹12–₹15L = 20%, Above ₹15L = 30%. Plus 4% health & education cess on total tax. Standard deduction of ₹75,000 is available for salaried employees.
Can I switch between old and new tax regime?+
Salaried employees and pensioners can switch between old and new tax regime every year when filing ITR. However, if you have business or professional income (ITR-3 or ITR-4), you can switch only once from new to old regime.
How is TDS on salary calculated?+
Your employer deducts TDS on salary monthly based on your estimated annual income and the tax regime you've chosen. TDS = (Estimated annual tax liability) ÷ 12 per month. Submit Form 12BB to your employer declaring investments and deductions to reduce TDS.