The New Tax Regime has been the default since FY 2023-24. But for many taxpayers, the Old Regime with its deductions may still result in lower taxes. Here is a data-driven comparison to help you decide.
New Tax Regime Slabs (FY 2024-25)
Up to ₹3 lakh: Nil | ₹3–7 lakh: 5% | ₹7–10 lakh: 10% | ₹10–12 lakh: 15% | ₹12–15 lakh: 20% | Above ₹15 lakh: 30%. Income up to ₹7 lakh is effectively tax-free due to Section 87A rebate.
Old Tax Regime Key Deductions
Section 80C (up to ₹1.5 lakh), 80D (health insurance), HRA, home loan interest under Section 24, NPS under 80CCD(1B), and standard deduction of ₹50,000.
Break-Even Analysis
Generally, if your total deductions exceed ₹3.75 lakh (at ₹15 lakh income), the Old Regime saves more tax. Below this deduction threshold, New Regime is better. Our CA calculates exact tax under both regimes for every client before filing.
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