In-hand SalaryNew or old tax regime: which leaves more in hand?
Salaried people can choose the regime each year with their employer, and again when filing the return. The rates and conditions are on the Tax Slabs site of this family. This page shows what the choice does to monthly take-home pay at common CTC levels, when the only old-regime deductions are the standard deduction, employee PF and professional tax.
| CTC | New regime, a month | Old regime, a month | Better |
|---|---|---|---|
| ₹5,00,000 | ₹36,657 | ₹36,657 | Same |
| ₹8,00,000 | ₹58,776 | ₹55,001 | New regime |
| ₹10,00,000 | ₹73,522 | ₹66,680 | New regime |
| ₹12,00,000 | ₹88,269 | ₹78,279 | New regime |
| ₹15,00,000 | ₹1,03,574 | ₹93,497 | New regime |
| ₹20,00,000 | ₹1,33,551 | ₹1,18,860 | New regime |
| ₹30,00,000 | ₹1,86,578 | ₹1,69,587 | New regime |
| ₹50,00,000 | ₹2,85,536 | ₹2,68,701 | New regime |
Why the new regime usually wins in this table
The new regime has wider slabs and a rebate that makes income up to about ₹12.75 lakh of salary tax-free, while the old regime in this table gets only about ₹2 lakh of deductions. The old regime wins when the deductions you can really claim are large: house rent allowance, interest on a home loan, section 80C beyond PF, health insurance under 80D and the National Pension System extra deduction.
A simple way to decide
- Work out your take-home in the calculator for both regimes.
- List the old-regime deductions you actually have, with proof: rent paid, home loan interest, 80C investments you would make anyway, health insurance.
- Use the break-even table on Tax Slabs to see if your deductions are above the amount needed.
- Remember that investments made only for tax saving may be locked in for years.
Common questions
Can I switch regime every year?
A salaried person can choose each year. The rules differ for people with business income, so check the Income Tax Department's guidance.
Does my employer need to know my choice?
Employers deduct tax according to the regime you tell them; if you say nothing, the new regime is the default.
Is HRA allowed in the new regime?
House rent allowance exemption is an old regime benefit and is not counted in this site's new regime figures.
- Tax slabs, rebate, surcharge and cess for tax year 2026-27: Memorandum explaining the provisions of the Finance Bill, 2026 (Ministry of Finance) and the Income Tax Department e-filing help page "Salaried Individuals for AY 2026-27". Checked on 11 November 2026.
- Gratuity formula (15 days of wages for each year of service, a month taken as 26 days): Payment of Gratuity Act, 1972, section 4(2). Employee and employer PF at 12% of wages: Employees' Provident Funds Scheme, 1952.
- PF wage ceiling of ₹25,000 a month from 17 September 2026 (Gazette notification S.O. 5109(E) under the Code on Social Security, 2020): Press Information Bureau releases on the EPFO wage ceiling (PRID 2313829, PRID 2314111). Read on 13 November 2026 (the Gazette text itself was not opened).
- Professional tax: a state tax; this page assumes ₹2,500 a year, and states differ, some charge less and some have none.
This is an estimate built on the assumptions listed on the page, with tax rates checked on 11 November 2026. It is general information, not tax or financial advice. Your own payslip can differ. Confirm tax questions at incometax.gov.in or with a professional.