For most salaried Indians today, the new tax regime results in lower tax than the old regime — even after claiming 80C, 80D, HRA, and home loan deductions. That wasn’t always true, but the FY 2025-26 slab changes shifted the math decisively. Below is the exact tax under both regimes for salaries from ₹8 lakh to ₹60 lakh, and the precise deduction level at which the old regime starts winning.
The short version: if your combined deductions — 80C + 80D + HRA + home loan interest, on top of the standard deduction — are under ₹5–6 lakh, the new regime almost certainly wins. Above ₹8 lakh in deductions, the old regime usually wins. And that ₹8 lakh figure holds constant for every salary above roughly ₹25 lakh.
Tax under both regimes, by salary
This table shows your tax liability under the new regime, and the exact amount of additional deductions (beyond the standard deduction) you’d need under the old regime to come out ahead. Standard deduction is already applied separately in each regime — ₹75,000 for new, ₹50,000 for old — and all figures include 4% cess.
| Salary | Tax (new regime) | Old regime wins if deductions exceed |
|---|---|---|
| ₹8L | ₹0 | Never — already zero |
| ₹9L | ₹0 | Never — already zero |
| ₹10L | ₹0 | Never — already zero |
| ₹12L | ₹0 | Never — already zero |
| ₹13L | ₹26,000 | ~₹6.9L |
| ₹15L | ₹97,500 | ~₹5.4L |
| ₹18L | ₹1,50,800 | ~₹6.4L |
| ₹20L | ₹1,92,400 | ~₹7.1L |
| ₹25L | ₹3,19,800 | ₹8L |
| ₹30L | ₹4,75,800 | ₹8L |
| ₹31L | ₹5,07,000 | ₹8L |
| ₹40L | ₹7,87,800 | ₹8L |
| ₹55L | ₹12,55,800 | ₹8L |
| ₹60L | ₹14,11,800 | ₹8L |
“Deductions” here means everything you’d claim under the old regime beyond its own standard deduction — Section 80C (PPF, ELSS, EPF, life insurance), Section 80D (health insurance), HRA exemption if you rent, and home loan interest under Section 24(b). Add these up for your actual situation and compare against the figure in the table.
Why the new regime wins for most people now
Two things changed the math. First, the Section 87A rebate now zeroes out tax entirely up to ₹12.75 lakh gross salary under the new regime — a threshold the old regime doesn’t come close to matching. Second, the new regime’s slabs between ₹8–16 lakh (10% and 15%) are considerably gentler than the old regime’s jump to 20% above just ₹5 lakh. That gap is large enough that even a home loan plus maxed-out 80C and 80D often isn’t enough to close it.
For the full slab-by-slab rates and every deduction each regime allows, see our old vs new tax regime guide.
Two real examples
The ₹8 lakh rule for high earners
Here’s the part worth remembering if you earn well above ₹25 lakh: once both regimes have pushed you into their top tax slab, the crossover point stops moving. It settles at exactly ₹8 lakh in deductions, no matter how high your salary climbs after that. A ₹30 lakh earner and a ₹60 lakh earner need the identical ₹8 lakh in 80C, 80D, HRA, and home loan interest combined before the old regime starts saving them money — it’s a fixed gap built into how the two slab structures compare at the top rate, not something that scales with income.
How to check your own numbers
80C investments, health insurance premiums, rent paid if you claim HRA, and home loan interest if applicable. This single total is what matters.
Find your salary in the table and see how your deduction total stacks up against the threshold for that income level.
Run your exact numbers through our Tax Regime Calculator — it computes your liability under both regimes side by side using your Form 16 or salary slip.
A new home loan, a rent increase, or a bigger 80C contribution can shift your deduction total past the crossover point. Last year’s answer isn’t automatically this year’s.
The bottom line
The new regime is now the right default for most salaried professionals — not just those with simple finances. You need genuinely large deductions (₹5–8 lakh depending on salary) before the old regime pulls ahead, and above ₹25 lakh that threshold is a flat ₹8 lakh regardless of how much you earn.
Run your own numbers once a year rather than assuming — a home loan or a big jump in rent can change the answer. Once you’ve settled on a regime, the next step is turning your actual take-home into a monthly budget that keeps your savings on track.
This post is for educational purposes only and does not constitute tax or financial advice. Tax calculations shown are illustrative based on FY 2025-26 slabs and standard assumptions; for personalised guidance, consult a chartered accountant.