Income Tax Calculator
The Income Tax Calculator is an easy-to-use tool to help taxpayers accurately know their tax liability. It allows users to calculate their taxes under the existing provisions of the country’s income tax laws. A reliable and updated online calculator is important as the government frequently updates tax slabs, structures, and other regulations.
Tax Regime Comparision
With the government introducing the New Tax Regime in 2020, featuring different slabs and fewer deduction benefits, taxpayers now often calculate which tax regime — old or new — suits them better. In this scenario, the income tax calculator helps taxpayers compare their tax liability under both regimes.
The Income Tax Calculator has been updated to incorporate the income tax changes introduced in the Union Budget 2024-25. Here’s a look at some sections offering deductions and the current tax slabs under the Old Tax Regime.
Those taxpayers still under the Old Tax Regime can avail of certain exemptions and deductions through tax-saving investments under various sections including 80C, 80D, 80G, 80E, and 80TTA.
Old Tax Regime slabs for individuals aged below 60 years & HUF:-
| Up to Rs 2,50,000 – NIL |
| Rs 2,50,001 – Rs 5,00,000 – 5% |
| Rs 5,00,001 to Rs 10,00,000 – 20% |
| Rs 10,00,001 and above – 30% |
Here’s what the New Tax Regime looks like after the Union Budget 2024-25:
The Centre introduced the New Tax Regime in 2020, and since then, several key changes have been made to attract more taxpayers to this regime. In the Union Budget of July 2024, the government revised tax slabs and increased the Standard Deduction by Rs 25,000, raising it to Rs 75,000.
New Tax Regime Slabs:
| Up to Rs 3 lakh – Nil |
| Rs 3 lakh – Rs 7 lakh – 5% |
| Rs 7 lakh – Rs 10 lakh – 10% |
| Rs 10 lakh – Rs 12 lakh – 15% |
| Rs 12 lakh – Rs 15 lakh – 20% |
| Above Rs 15 lakh – 30% |
How to use the Income tax calculator – Step-by-step guide
Select Financial Year: Choose the financial year for which you want your taxes to be calculated.
Select Age Group: Select your age group. This is because tax liability as per the government rules is based on the age of the income taxpayer.
Proceed to Next Step: Click on ‘Go to Next Step’.
Enter Taxable Salary (Old Tax Slabs): Enter your taxable salary after deducting exemptions such as HRA, LTA, etc.
Enter Gross Salary (New Tax Slabs): Enter your salary without deducting exemptions such as HRA, LTA, professional tax, etc.
Provide Additional Income Details: Enter details such as interest income, rental income, interest paid on a home loan for rented property, and interest paid on a loan for self-occupied property.
Income from Digital Assets: For income from digital assets, enter the net income (sale consideration minus the cost of acquisition). This income is taxed at 30% plus applicable surcharge and cess.
Proceed to Next Step Again: Click on ‘Go to Next Step’ again.
Tax Saving Investments (Old Tax Slabs): If you want to calculate your taxes under the old tax slabs, enter your tax-saving investments under sections 80C, 80D, 80G, 80E, and 80TTA.
Calculate Tax Liability: Click on ‘Calculate’ to get your tax liability. You will also see a comparison of your pre-budget and post-budget tax liability under both the old and new tax slabs.
Non-Applicable Fields: Enter “0” for any fields that do not apply to you.
Income Tax Calculator: FAQs
1. How much tax should I pay on my salary in the New Regime?
The tax you need to pay depends on the income slab you belong to.
2. What is the maximum non-taxable income limit?
Old Regime:
The maximum non-taxable income for an individual is Rs 2.5 lakh.
For FY 2018-19, you can get a rebate of Rs 2,500 under section 87A if your total income is up to Rs 3.5 lakh.
From FY 2019-20 onwards, the rebate under section 87A has been increased to Rs 12,500 for an income up to Rs 5 lakh, making income up to Rs 5 lakh non -taxable.
With tax-saving investments under section 80C up to Rs 1.5 lakh, you will not have to pay taxes on income up to Rs 6.5 lakh.
New Regime (Budget 2023):
The maximum non-taxable income for an individual is Rs 3 lakh.
For FY 2023-24, you can get a rebate of Rs 25,000 under section 87A if your total income is up to Rs 7 lakh, making income up to Rs 7 lakh non-taxable.
The rebate limit under section 87A remains Rs 5 lakh in the old regime.
3. Does everyone have to file their income tax returns?
If an individual’s income is below the basic exemption limit, they are not required to file income tax returns.
Those with income less than Rs 2.5 lakh (old regime) or Rs 3 lakh (new regime) who want to claim an income tax refund must file an ITR to claim the refund.
Filing income tax returns is mandatory in all other cases.
4. Does the income tax calculator calculate TDS?
No, the income tax calculator does not compute Tax Deducted at Source (TDS).
It calculates your tax liability for the assessment year.
5. What is the amendment in the Finance Act 2023?
The Finance Act 2023 has changed Section 115BAC, starting from the Assessment Year 2024-25, to make the new tax regime the default for Individuals, HUFs, AOPs (except co-operative societies), BOIs, and Artificial Juridical Persons. However, eligible taxpayers can still choose the old tax regime if they prefer.
For those without business income, you can select your preferred tax regime each year when you file your Income Tax Return (ITR) on or before the due date mentioned in section 139(1).
6. Who needs Form 10-IEA and why?
If you have income from business or profession and want to opt-out of the new tax regime, you need to submit Form 10-IEA before the due date for filing your income tax return under section 139(1). To switch back to the old tax regime, you also need to use Form 10-IEA. So, while the new tax regime is the default, you can choose to go with the old one if that works better for you.
7. Which is better for the taxpayers: The old tax regime or the new tax regime?
The better option between the old and new tax regimes varies for each individual. It’s recommended to compare both regimes based on your specific financial situation and needs. You can use the Income and Tax Calculator on the Income Tax Portal to estimate and compare your tax liability under both regimes before making a decision.
8. Is it necessary for employees to inform their employers about their chosen tax regime?
Yes, employees must inform their employers about their chosen tax regime for the year. If an employee does not provide this information, it will be assumed that they are using the default new tax regime, and the employer will deduct tax accordingly under section 115BAC.
However, informing the employer about the chosen tax regime does not count as officially opting out of the new tax regime under sub-section (6) of section 115BAC. The employee must complete this separately before the due date specified under section 139(1) for filing their income tax return.
9. As a salaried taxpayer, can I claim HRA exemption under the new tax regime?
In the old tax regime, salaried individuals can claim House Rent Allowance (HRA) exemption under section 10(13A). However, it should be noted that this exemption is not available in the new tax regime.
10. Can I claim the Rs 50,000 standard deduction under the new tax regime?
Yes, from Assessment Year 2024-25 onwards, you can claim a standard deduction of Rs. 50,000 or the amount of salary (whichever is lower) under both the old and new tax regimes.
11. For AY 2024-25, can I claim deductions under Chapter VIA, such as sections 80C, 80D, 80DD, and 80G in the new tax regime?
In the new tax regime, you cannot claim most Chapter VIA deductions, such as those under sections 80C, 80D, 80DD, and 80G. The only exceptions are deductions under sections 80CCD(2), 80CCH, and 80JJAA, as specified in Section 115BAC of the Income Tax Act, 1961.
If you want to claim other deductions, you need to opt for the old tax regime. You can do this by selecting the appropriate option in your ITR form: choose “Yes” in ITR 1 or ITR 2, or “Yes, within due date” in ITR 3, ITR 4, or ITR 5 under the “opting out option” section in the “Personal Information” or “Part-A General” section.
12. Can I claim a deduction of Rs 2,00,000 for interest on borrowed capital for a self-occupied property under the new tax regime?
Under the new tax regime, you cannot claim a deduction for interest on borrowed capital for a self-occupied property from your income under the Income from House Property section, as per Section 115BAC of the Income Tax Act, 1961.
If you wish to claim this deduction, you need to opt for the old tax regime. To do this, select “Yes” in ITR 1 or ITR 2, or “Yes, within due date” in ITR 3, ITR 4, or ITR 5 in the “opting out option” section of the ITR form.
13. As a senior citizen, are there any special tax rate benefits in the new tax regime similar to those in the old tax regime?
In the old tax regime, senior citizens have a basic exemption limit of Rs 3,00,000, while super senior citizens enjoy a limit of Rs 5,00,000. However, in the new tax regime, there are no specific exemptions based on age. Instead, no income tax is payable for total incomes up to Rs 7 lakh.
14. Is there a difference in the tax rebate under Section 87A between the old and new tax regimes?
Yes, there is a difference. In the old tax regime, a resident individual whose total income does not exceed Rs 5,00,000 can claim a rebate of 100% of the income tax, up to a maximum of Rs 12,500. In the new tax regime, the rebate is higher: it is Rs 25,000 or 100% of the income tax, whichever is lower, for total incomes up to Rs 7,00,000.
15. If I choose the new tax regime for AY 2024-25, can I switch between the old and new tax regimes in future years?
If you have business or professional income, you cannot switch between the old and new tax regimes every year. Once you opt out of the new tax regime, you only have one chance to switch back to it in the future.
After switching, you cannot revert to the old tax regime again. However, if you have non-business income, you can switch between the old and new tax regimes every year. Just remember, within the same year, you need to make your choice of the old tax regime before the due date for filing your return under section 139(1) of the Income Tax Act.
16. If I want to choose the old tax regime instead of the default new tax regime while filing my ITR for FY 2023-24 (AY 2024-25), do I need to file Form 10-IEA?
If you have business or professional income and want to opt for the old tax regime, you need to file Form 10-IEA before submitting your income tax return (ITR). However, if you don’t have business income and are using ITR-1 or ITR-2, you can simply select “Opting out of new regime” in the ITR form without needing to file Form 10-IEA. Only taxpayers with business income filing ITR-3, ITR-4, or ITR-5 need to submit Form 10-IEA.
17. I have business income and switched between the old and new tax regimes in previous years. Will I be in the old regime for AY 2024-25?
For AY 2024-25, the new tax regime is the default. Choices made in previous years regarding tax regimes do not carry over. If you want to opt for the old tax regime for AY 2024-25, you will need to submit Form 10-IEA again.
18. I have business income and mistakenly filed Form 10-IEA but want to file under the new tax regime. Since there is no option to withdraw Form 10-IEA, can I still file my return under the new tax regime?
Once Form 10-IEA is filed for AY 2024-25, it cannot be revoked or withdrawn for the same assessment year. If you want to switch to the new tax regime, you will need to wait until the next assessment year to file a Form 10-IEA for withdrawal. Remember, the choice of tax regime must be made before the due date for filing your return under section 139(1) of the Income Tax Act.
19. I am filing ITR-5 and want to opt out of the new tax regime. Should I use Form 10-IFA or Form 10-IEA?
If you are filing ITR-5 and want to opt out of the new tax regime, you should use Form 10-IEA. Form 10-IFA is used by new manufacturing co-operative societies filing ITR-5 who wish to avail the new tax regime under Section 115BAE.
