Income Tax Calculator

Income tax is a percentage of what you earn in a financial year — salary, business profit, rent, interest, capital gains, and more — that you pay to the Government of India. It’s collected under the Income-tax Act, 2025 (which replaced the older Income-tax Act, 1961) and funds public services like infrastructure, defence, healthcare, and welfare schemes.

A financial year (FY) runs from 1 April to 31 March. The tax you owe for FY 2026-27 is assessed and filed in the following year — the assessment year (AY) 2027-28. You’ll often see both written together, like “FY 2026-27 (AY 2027-28)”.

Not everyone owes tax — India uses a slab system, where different portions of your income are taxed at different rates, and the first portion is tax-free (the “basic exemption limit”). This calculator applies that slab system for you automatically.

India currently lets you choose between two ways of computing your tax each year:

• New regime— lower tax rates across more, narrower slabs, but you give up most deductions and exemptions (no 80C, no HRA exemption, etc.). It’s the default regime unless you actively choose the old one. It gets a flat ₹75,000 standard deduction if you have salary or pension income, and nothing else to claim.
• Old regime — higher rates, but you can reduce your taxable income first by claiming deductions: Section 80C investments (PF, ELSS, life insurance, etc., up to ₹1.5 lakh), 80D health insurance premiums, HRA exemption if you pay rent, home loan interest, and several others.

Which one is cheaper depends entirely on how many deductions you actually have. Someone with a home loan, rent receipts, and maxed-out 80C investments often does better under the old regime. Someone with few deductions usually does better under the new one. This calculator computes both and tells you which one saves you more for the numbers you enter — that’s exactly what the “Old Regime saves you more” / “New Regime saves you more” banner above means.

Your income isn’t taxed at one flat rate — it’s split into bands (“slabs”), and each band is taxed at its own rate, with the rate increasing as you move into higher bands. For example, under the new regime, income between ₹8 lakh and ₹12 lakh is taxed at 10% — but that 10% only applies to the portion of your income that falls in that band, not your entire income.

This is why the “Tax Slab Breakdown” table on this page shows tax calculated separately for each band — it’s adding up exactly how your final tax number was built, slab by slab.

A rebate is a direct reduction of the tax you’d otherwise owe, given to lower and middle-income taxpayers so they pay little or no tax. Section 87A is the specific rule that grants this rebate — under the new regime for FY 2026-27, if your taxable income is ₹12 lakh or less, you get a rebate of up to ₹60,000, which is usually enough to bring your tax bill to zero. Under the old regime, the rebate is smaller — up to ₹12,500 for taxable income up to ₹5 lakh.

There’s one more subtlety worth knowing: marginal relief.Without it, earning even ₹1 more than the ₹12 lakh cutoff under the new regime could mean losing the entire ₹60,000 rebate at once — a huge jump in tax for a tiny increase in income. Marginal relief prevents that cliff: if you’re just over the threshold, your tax is capped at only the amount by which your income exceeds ₹12 lakh, so the tax increase is never larger than the income increase that caused it. This calculator applies marginal relief automatically when it's relevant — you'll see it reflected in the “Rebate u/s 87A” line in your results.

A perquisite (often shortened to “perk”) is a benefit an employer gives you in addition to your regular salary — things like a company car, rent-free accommodation, employer-paid club memberships, stock options (ESOPs), or interest-free loans from your employer. Most perquisites have a taxable value even though you never received them as cash, and that value gets added to your taxable salary income.

Some perquisites are fully exempt (like reimbursed business travel), some are partly exempt, and some are fully taxable — the rules vary a lot by perquisite type. This calculator doesn’t model perquisite valuation; if a significant part of your pay is in perquisites rather than plain salary, it’s worth getting a proper computation done rather than relying on the gross-income figure alone.

Form 16 is a certificate your employer is required to give you (usually by mid-June each year) if they deducted TDS (Tax Deducted at Source) from your salary during the year. It has two parts:

• Part A — a summary of the tax your employer deducted and deposited with the government on your behalf, quarter by quarter.
• Part B — a detailed breakup of your salary, exemptions (like HRA), deductions claimed through your employer, and the final tax computation they used.

Form 16 is the single most useful document for filing your income tax return (ITR) if you’re a salaried employee — most of the numbers you need are already summarized on it. It's not the same as filing your return, though; you still need to file the ITR yourself (or have someone file it for you) using the information on Form 16 as your starting point.

TDS (Tax Deducted at Source) is tax that’s deducted upfront, before you receive certain kinds of income — your employer deducts it from salary, a bank deducts it from interest above a threshold, and so on. It’s a collection mechanism, not a separate tax: it's an advance payment against your actual, final tax liability for the year.

When you file your return, your actual tax liability (like the “Total Tax” this calculator shows you) is compared against the TDS already deducted through the year. If more was deducted than you actually owe, you get a refund. If less was deducted than you owe, you pay the difference.

Surchargeis an extra charge on top of your calculated tax, but only for high-income taxpayers — it kicks in once taxable income crosses ₹50 lakh, and rises in steps as income increases further. It doesn’t apply at all to most taxpayers.

Health & Education Cess is a flat 4% added on top of your tax (including any surcharge), and applies to everyone who owes tax, regardless of income level. It funds specific health and education programs. Both are shown as separate line items in your results above so you can see exactly what's adding to your final number beyond the basic slab tax.