Tax SlabsIncome tax on a salary of ₹4 lakh, tax year 2026-27
On a salary of ₹4,00,000 (₹4 lakh) in tax year 2026-27, a resident salaried person pays no income tax in the new regime. In the old regime with no deductions other than the standard deduction, the tax would be nil.
New regime: the working, step by step
- Salary for the year: ₹4,00,000
- Less standard deduction: ₹75,000
- Taxable income: ₹3,25,000
Tax on the slabs:
- Nil on ₹3,25,000 (the first ₹4,00,000): ₹0
Tax on the slabs comes to ₹0. With no tax there is no cess either.
Tax for the year: nil.
After this tax, ₹4,00,000 of the salary is left for the year, about ₹33,333 a month. Provident fund, professional tax and other deductions your employer makes are separate and are not counted here.
Old regime with no deductions
- Salary for the year: ₹4,00,000
- Less standard deduction: ₹50,000
- Taxable income: ₹3,50,000
Tax on the slabs:
- Nil on ₹2,50,000 (the first ₹2,50,000): ₹0
- 5% on ₹1,00,000 (from ₹2,50,000 to ₹3,50,000): ₹5,000
Tax on the slabs comes to ₹5,000. The taxable income is not more than ₹5,00,000, so the rebate takes off ₹5,000 and the tax becomes ₹0. With no tax there is no cess either.
Tax for the year: nil.
Old regime with deductions
The old regime allows deductions that the new regime does not. This table shows the tax on the same salary for some totals of deductions.
| Deductions claimed | Old regime tax | New regime tax | Result |
|---|---|---|---|
| None | ₹0 | ₹0 | Same in both |
| ₹1,50,000 | ₹0 | ₹0 | Same in both |
| ₹2,00,000 | ₹0 | ₹0 | Same in both |
| ₹3,00,000 | ₹0 | ₹0 | Same in both |
Which regime costs less at ₹4 lakh?
At this salary the old regime is not costlier even without deductions, because both regimes give a nil or equal tax. There is nothing to gain or lose by choosing either.
How to compare the two regimes
If the salary rises by ₹1 lakh
At a salary of ₹5,00,000 the new regime tax is nil. That is no more tax on the extra ₹1,00,000, so ₹1,00,000 of the raise stays with you. Only the top slice of income is taxed at the higher rate; the tax on the rest does not change.
Senior citizens
The new regime has the same slabs for every age, so the figure above applies to pensioners too. In the old regime with no deductions, a person aged 60 to 79 would pay no tax and a person aged 80 or more no tax on a pension of this size.
Common questions
How much income tax on a salary of ₹4 lakh?
For tax year 2026-27 the new regime tax on a yearly salary of ₹4,00,000 is nil including cess. The old regime tax with only the standard deduction is nil.
Which regime is better for a ₹4 lakh salary?
At this salary the old regime is not costlier even without deductions, because both regimes give a nil or equal tax. There is nothing to gain or lose by choosing either.
How much tax is deducted each month?
If the employer spreads the tax evenly over twelve months, the new regime deduction on this salary is about ₹0 a month. In practice the employer recalculates it during the year when pay or declarations change.
Salary of ₹3 lakh Salary of ₹5 lakh Open this salary in the calculator Whole table
Sources
- Slabs of both regimes, surcharge and cess for tax year 2026-27: Memorandum explaining the provisions of the Finance Bill, 2026, Ministry of Finance (February 2026), which states that no change is proposed in these rates.
- The same rates, the rebate limits and the deduction limits for financial year 2025-26: Income Tax Department, e-filing portal help page "Salaried Individuals for AY 2026-27".
- Checked on 11 November 2026.
Rates checked on 11 November 2026 against the Finance Bill, 2026 memorandum and the Income Tax Department's e-filing help pages. Tax law changes with every Budget and has many special cases. This page is general information and arithmetic, not tax advice: confirm your own position at incometax.gov.in or with a tax professional.