Income tax slabs for FY 2025-26 AY 2026-27
For Financial Year (FY) 2025-26 (Assessment Year 2026-27), the income tax slabs were significantly revised in the Union Budget 2025. The New Tax Regime remains the default choice and offers a higher tax-free threshold compared to previous years.
New Tax Regime Slabs (Default)
This regime is the same for all individuals, including senior and super-senior citizens.
- ₹0 – ₹4,00,000: Nil
- ₹4,00,001 – ₹8,00,000: 5%
- ₹8,00,001 – ₹12,00,000: 10%
- ₹12,00,001 – ₹16,00,000: 15%
- ₹16,00,001 – ₹20,00,000: 20%
- ₹20,00,001 – ₹24,00,000: 25%
- Above ₹24,00,000: 30%
Key Benefits in New Regime:
- Zero Tax up to ₹12 Lakh: A tax rebate of up to ₹60,000 under Section 87A ensures zero tax liability for resident individuals with taxable income up to ₹12 lakh.
- Standard Deduction: Salaried individuals and pensioners can claim a standard deduction of ₹75,000.
- Effective Tax-Free Limit: For salaried employees, income up to ₹12.75 lakh is effectively tax-free after the standard deduction and rebate.
Old Tax Regime Slabs
The old regime remains unchanged and allows various deductions (like 80C, 80D, and HRA).
| Income Slab [6, 7, 17, 18, 19] | Individuals (<60 years) | Senior Citizens (60–79) | Super Senior Citizens (80+) |
|---|---|---|---|
| Up to ₹2.5 Lakh | Nil | Nil | Nil |
| ₹2.5L – ₹3 Lakh | 5% | Nil | Nil |
| ₹3L – ₹5 Lakh | 5% | 5% | Nil |
| ₹5L – ₹10 Lakh | 20% | 20% | 20% |
| Above ₹10 Lakh | 30% | 30% | 30% |
| Sources: |
Other Applicable Taxes:
- Health & Education Cess: 4% is added to the total income tax payable under both regimes.
- Surcharge: Applies if total income exceeds ₹50 lakh. The highest surcharge rate in the New Regime is capped at 25% (compared to 37% in the Old Regime for income above ₹5 crore).