Tax Calculator Guide: How Income Tax Is Calculated in India
India uses a slab-based progressive tax system. Understanding the slabs, deductions, and old vs new regime helps you minimise your tax burden legally.
India Tax Slabs (FY 2024-25)
New Tax Regime
| Income | Rate |
|---|---|
| Up to ₹3L | 0% |
| ₹3L – ₹7L | 5% |
| ₹7L – ₹10L | 10% |
| ₹10L – ₹12L | 15% |
| ₹12L – ₹15L | 20% |
| Above ₹15L | 30% |
Old Tax Regime
| Income | Rate |
|---|---|
| Up to ₹2.5L | 0% |
| ₹2.5L – ₹5L | 5% |
| ₹5L – ₹10L | 20% |
| Above ₹10L | 30% |
Old regime allows Section 80C, 80D, HRA, and other deductions.
Key Deductions (Old Regime)
EPF, PPF, ELSS, LIC, home loan principal, tuition fees
Health insurance premiums (self, family, parents)
Flat deduction from salary income, no proof needed
Exemption based on rent paid, salary, and city
Frequently Asked Questions
What is the income tax slab for FY 2024-25 in India?
Under the new tax regime: 0% up to ₹3L, 5% for ₹3–7L, 10% for ₹7–10L, 15% for ₹10–12L, 20% for ₹12–15L, and 30% above ₹15L. Under the old regime: 0% up to ₹2.5L, 5% for ₹2.5–5L, 20% for ₹5–10L, 30% above ₹10L.
What is TDS?
TDS (Tax Deducted at Source) is tax deducted by the employer or payer before crediting income. Your employer deducts TDS monthly from salary and deposits it with the government. The TDS deducted is credited to your Form 26AS and can be claimed when filing returns.
What deductions can reduce my taxable income?
Under the old regime: Section 80C (₹1.5L — PF, ELSS, PPF, insurance), 80D (health insurance ₹25K–75K), HRA, standard deduction (₹50K), home loan interest (₹2L). The new regime allows only standard deduction of ₹75K.
Which tax regime is better — old or new?
The new regime has lower rates but fewer deductions. The old regime suits those with high 80C/80D investments and HRA. Generally, if your deductions exceed ₹3.75L, the old regime saves more tax. Use a tax calculator to compare both regimes for your specific income and investments.
What is surcharge on income tax?
Surcharge is an additional charge on income tax for high earners. For income ₹50L–₹1Cr: 10% surcharge. For ₹1–2Cr: 15%. For ₹2–5Cr: 25%. Above ₹5Cr: 37% (new regime), 25% (old regime). Surcharge is applied to the income tax calculated, not the income.
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