What is the old tax regime in India?

The old tax regime is the traditional income tax system under the Income Tax Act that allows taxpayers to claim various deductions and exemptions in exchange for higher slab rates. It includes deductions under Section 80C (up to Rs 1.5 lakh), 80D (health insurance), HRA exemption under Section 10(13A), home loan interest under Section 24(b), NPS under 80CCD(1B), and several other exemptions that reduce taxable income.

What are the old tax regime slabs for FY 2026-27?

The old tax regime slabs for FY 2026-27 depend on age. For individuals below 60: up to Rs 2.5 lakh (nil), Rs 2.5-5 lakh (5%), Rs 5-10 lakh (20%), above Rs 10 lakh (30%). For senior citizens (60-80): up to Rs 3 lakh (nil), Rs 3-5 lakh (5%), Rs 5-10 lakh (20%), above Rs 10 lakh (30%). For super senior citizens (80+): up to Rs 5 lakh (nil), Rs 5-10 lakh (20%), above Rs 10 lakh (30%).

What deductions are available under the old tax regime?

The old tax regime offers a wide range of deductions: Section 80C up to Rs 1.5 lakh (PPF, ELSS, EPF, life insurance, NSC, tax-saving FDs, tuition fees, home loan principal), 80D for health insurance (up to Rs 25,000 for self/family, Rs 50,000 for senior citizens), 80CCD(1B) for NPS (up to Rs 50,000), Section 24(b) for home loan interest (up to Rs 2 lakh), HRA exemption, standard deduction of Rs 50,000, and others like 80E (education loan), 80G (donations), and 80TTA (savings account interest).

How is tax calculated under the old tax regime?

Tax under the old regime is calculated by: (1) computing gross total income from salary, business, capital gains, house property, and other sources, (2) subtracting exemptions like HRA and standard deduction of Rs 50,000, (3) subtracting Chapter VI-A deductions (80C, 80D, 80CCD(1B), 80E, 80G, etc.), (4) subtracting home loan interest under Section 24(b) up to Rs 2 lakh, (5) applying the applicable slab rates based on age, (6) applying Section 87A rebate if taxable income is Rs 5 lakh or less, (7) adding surcharge if income exceeds Rs 50 lakh, and (8) adding 4% health and education cess.

Is the old tax regime better for salaried employees?

The old tax regime is generally better for salaried employees who have significant deductions and exemptions. If your total deductions (80C, 80D, HRA, home loan interest, NPS) exceed approximately Rs 3-4 lakh, the old regime typically results in lower tax. It is especially beneficial for those paying HRA in metro cities, paying home loan interest, or making full use of Section 80C and 80D limits.

Can I claim HRA exemption under the old tax regime?

Yes, HRA exemption under Section 10(13A) is available under the old tax regime. The exemption is the minimum of three amounts: actual HRA received from employer, 50% of basic salary for metro cities (40% for non-metros), and actual rent paid minus 10% of basic salary. This can substantially reduce taxable income for salaried employees living in rented accommodation.

What is Section 87A rebate under the old tax regime?

Under the old tax regime, Section 87A provides a rebate of up to Rs 12,500 if the total taxable income does not exceed Rs 5 lakh. The rebate equals the lower of the actual tax payable or Rs 12,500. This effectively makes income up to Rs 5 lakh tax-free under the old regime. Note that the rebate limit is significantly lower than the Rs 60,000 rebate available under the new regime for incomes up to Rs 12 lakh.

What is the maximum 80C deduction under the old regime?

The maximum deduction under Section 80C is Rs 1.5 lakh per financial year. This covers investments in PPF, ELSS mutual funds, EPF, tax-saving fixed deposits (5-year), NSC, life insurance premiums, Sukanya Samriddhi Yojana, tuition fees for up to two children, and principal repayment of home loan. An additional Rs 50,000 deduction is available under Section 80CCD(1B) for NPS contributions, over and above the Rs 1.5 lakh 80C limit.

Can I switch from the old regime to the new regime?

Yes, salaried individuals can switch between the old and new tax regimes each financial year. The choice is made at the time of filing the ITR. However, if you have business or professional income, the choice is a one-time decision and you cannot switch back once you opt for the new regime, unless you cease to have business income.

What is the standard deduction under the old tax regime?

The standard deduction under the old tax regime is Rs 50,000 for salaried employees and pensioners. This replaces the earlier transport allowance (Rs 19,200) and medical reimbursement (Rs 15,000). The standard deduction under the new regime is higher at Rs 75,000 for FY 2026-27.

How does home loan tax benefit work under the old regime?

Under the old tax regime, home loan borrowers get two tax benefits: principal repayment up to Rs 1.5 lakh is deductible under Section 80C, and interest payment up to Rs 2 lakh is deductible under Section 24(b) for a self-occupied property. For let-out properties, the entire interest is deductible without any upper limit, though it is subject to the house property income computation rules.

What is the maximum income to pay zero tax under the old regime?

Under the old regime, taxable income up to Rs 5 lakh results in zero tax liability after the Section 87A rebate of Rs 12,500. For salaried employees with the standard deduction of Rs 50,000 and some 80C investments, the actual salary that results in zero tax can be higher. For example, a salaried individual earning Rs 7.5 lakh with Rs 1.5 lakh in 80C investments and Rs 50,000 standard deduction would have a taxable income of Rs 5.5 lakh, resulting in tax of approximately Rs 15,600 after rebate, which is still relatively low.

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Old Tax Regime Calculator: Free Online Tax Calculator India

What Is the Old Tax Regime?

The old tax regime is the traditional income tax system under the Income Tax Act, 1961 that allows taxpayers to claim a wide range of deductions and exemptions before computing their tax liability. It has been the default tax structure for decades and remains available to all individual and HUF taxpayers in India.

Under the old regime, taxpayers can claim deductions under Chapter VI-A (Sections 80C, 80D, 80E, 80G, 80TTA, 80CCD), the standard deduction of Rs 50,000, HRA exemption for salaried employees living in rented housing, home loan interest deduction under Section 24(b) up to Rs 2 lakh, and many other exemptions. The trade-off is that the old regime has higher tax rates compared to the new regime introduced in Budget 2020.

From FY 2023-24 onwards, the new tax regime became the default regime, but taxpayers can still choose the old regime by formally opting out of the new regime at the time of filing their income tax return. The choice between regimes is available every year for salaried individuals. Use the Income Tax Calculator to compare both regimes side by side.

Old Tax Regime Slabs FY 2026-27

The old tax regime has four income slabs with rates of 0%, 5%, 20%, and 30% where the basic exemption limit depends on the taxpayer age category, making it more beneficial for senior and super senior citizens.

Old tax regime income tax slabs by age category for FY 2026-27
Income Slab	Below 60 Years	Senior (60-80)	Super Senior (80+)
Up to Rs 2.5L	0%	0%	0%
Rs 2.5L - Rs 3L	5%	0%	0%
Rs 3L - Rs 5L	5%	5%	0%
Rs 5L - Rs 10L	20%	20%	20%
Above Rs 10L	30%	30%	30%

Senior citizens (60 to 80 years) get a higher basic exemption of Rs 3 lakh compared to Rs 2.5 lakh for those below 60. Super senior citizens (80+ years) have the highest exemption of Rs 5 lakh, meaning their first Rs 5 lakh of income is entirely tax-free under the old regime. The 30 per cent rate kicks in above Rs 10 lakh for all age groups.

Section 87A Rebate Under Old Regime

Section 87A provides a full tax rebate for resident individuals whose total taxable income does not exceed Rs 5 lakh in a financial year, with the rebate amount being the lower of actual tax payable or Rs 12,500.

For example, if your gross salary is Rs 8 lakh and you claim Rs 3.5 lakh in deductions (80C of Rs 1.5 lakh, 80D of Rs 50,000, NPS of Rs 50,000, standard deduction of Rs 50,000, and HRA of Rs 50,000), your taxable income drops to Rs 4.5 lakh. The slab tax on Rs 4.5 lakh is Rs 12,500, and the Section 87A rebate of Rs 12,500 brings it to zero.

The Section 87A rebate applies to all age categories. Super senior citizens already have a Rs 5 lakh exemption and rarely need it. The rebate limit under the old regime (Rs 12,500) is significantly lower than the rebate available under the new regime (Rs 60,000 for income up to Rs 12 lakh).

Old Regime Deductions Overview

The old tax regime offers a comprehensive set of deductions covering investments, insurance, housing, education, and health expenses that can collectively reduce taxable income by Rs 4-6 lakh or more per year.

Key deductions available under the old tax regime for FY 2026-27
Section	Purpose	Maximum Deduction
80C	EPF, PPF, ELSS, Life Insurance, Tuition Fees, Home Loan Principal	Rs 1.5 lakh
80D	Health Insurance Premiums (Self, Family, Parents)	Up to Rs 25K / Rs 50K
80CCD(1B)	Additional NPS Contribution	Rs 50,000
24(b)	Home Loan Interest (Self-Occupied Property)	Rs 2 lakh
80E	Education Loan Interest Repayment	No limit (10 years)
80G	Donations to Approved Charitable Funds	50% or 100% of donation
80TTA	Savings Account Interest	Rs 10,000
HRA	House Rent Allowance Exemption	Actual HRA / 50% basic
Standard	Standard Deduction for Salaried Employees	Rs 50,000

The combined effect of these deductions can be substantial. A salaried employee contributing to EPF (Section 80C), paying health insurance (Section 80D), contributing to NPS (80CCD(1B)), paying home loan interest, and claiming HRA can reduce their taxable income by Rs 4-6 lakh or more per year. Use the Tax Saving Calculator to see how each deduction impacts your final tax liability.

Tax Calculation Under Old Regime

Tax under the old regime is calculated by first determining gross total income, subtracting exemptions and deductions, applying age-based slab rates, then adding surcharge and 4 per cent health and education cess.

Consider a salaried employee earning a gross salary of Rs 15 lakh per year with the following deductions: basic salary of Rs 6 lakh, HRA received of Rs 2.4 lakh, actual rent paid of Rs 2.8 lakh in a metro city, 80C investments of Rs 1.5 lakh, health insurance of Rs 30,000, NPS contribution of Rs 50,000, and home loan interest of Rs 1.8 lakh.

Worked example: tax calculation under old regime for FY 2026-27
Component	Amount
Gross Salary	Rs 15,00,000
HRA Exemption	Rs 1,80,000
Net Salary	Rs 13,20,000
Other Income	Rs 0
Gross Total Income	Rs 13,20,000
Standard Deduction	Rs 50,000
Section 80C	Rs 1,50,000
Section 80D	Rs 30,000
NPS 80CCD(1B)	Rs 50,000
Home Loan Interest 24(b)	Rs 1,80,000
Total Deductions	Rs 4,60,000
Taxable Income	Rs 8,60,000
Tax on Rs 2.5-5L at 5%	Rs 12,500
Tax on Rs 5-8.6L at 20%	Rs 72,000
Total Slab Tax	Rs 84,500
Section 87A Rebate	Rs 0 (income > Rs 5L)
Surcharge	Rs 0 (income < Rs 50L)
Cess at 4%	Rs 3,380
Total Tax Liability	Rs 87,880
Effective Tax Rate	5.9%

This example shows how the old regime deductions reduce taxable income from Rs 15 lakh to Rs 8.6 lakh, resulting in an effective tax rate of only 5.9 per cent. Under the new regime without these deductions, the same income would attract approximately Rs 97,500 in tax including cess. The old regime saves roughly Rs 10,000 in this scenario.

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Old Regime vs New Regime Comparison

The choice between old and new regimes depends entirely on your deduction profile where the new regime offers lower tax rates with no deductions while the old regime has higher rates but extensive deduction options.

Old regime vs new regime comparison for FY 2026-27
Feature	Old Regime	New Regime
Number of Slabs	4 slabs: 0%, 5%, 20%, 30%	7 slabs: 0-30%
Basic Exemption	Rs 2.5L / Rs 3L / Rs 5L	Rs 4 lakh (all ages)
Standard Deduction	Rs 50,000	Rs 75,000
Section 80C Deductions	Up to Rs 1.5 lakh	Not available
Section 80D Health Insurance	Up to Rs 25K/50K	Not available
NPS 80CCD(1B)	Up to Rs 50,000 additional	Employer NPS only
HRA Exemption	Available	Not available
Home Loan Interest 24(b)	Up to Rs 2 lakh	Not available
Section 87A Rebate	Up to Rs 12,500 (income Rs 5L)	Up to Rs 60,000 (income Rs 12L)
Zero Tax Limit (Salaried)	~Rs 5.5L (with deductions)	~Rs 12.75L gross salary
Surcharge	Up to 37% (income > Rs 5Cr)	Up to 25% (income > Rs 5Cr)

As a general rule: if your total deductions exceed Rs 3-4 lakh per year, the old regime likely saves you more tax. If you have minimal deductions or prefer simplicity, the new regime is usually better. Use the Old vs New Tax Regime Calculator to compare both regimes with your specific numbers. Also check the New Tax Regime Calculator for a detailed breakdown of your tax under the new regime alone.

How to Maximize Old Regime Tax Savings

Maximising your tax savings under the old regime requires a strategic approach to using every available deduction and exemption, starting with the Rs 1.5 lakh Section 80C limit and layering additional deductions on top.

Max out Section 80CInvest the full Rs 1.5 lakh limit in EPF, PPF, ELSS, or life insurance. ELSS mutual funds offer the shortest 3-year lock-in with potential market-linked returns, while PPF provides tax-free interest backed by the government. Together with your mandatory EPF contribution, filling the 80C limit is usually straightforward for most salaried employees.

Claim HRA strategicallyIf you live in rented accommodation, ensure your rent exceeds 10 per cent of your basic salary to maximise the HRA exemption. In metro cities, you can claim up to 50 per cent of basic salary as HRA exemption. For non-metro cities, the limit is 40 per cent. Paying rent to parents (with their PAN for the landlord declaration) is also a valid way to claim HRA.

Use NPS additional deductionContribute Rs 50,000 to NPS under Section 80CCD(1B) on top of your 80C limit. This is an extra deduction that many taxpayers overlook. For maximum impact, combine employer NPS contributions under 80CCD(2) which has no upper limit. The NPS also offers market-linked returns with low fund management charges.

Cover health insurance under 80DPay health insurance premiums for yourself, your spouse, children, and parents. You can claim up to Rs 25,000 for self and family plus Rs 50,000 for senior citizen parents for a total of Rs 75,000. Preventive health check-ups up to Rs 5,000 are also covered within this limit.

Claim home loan interestIf you have a home loan, the interest component up to Rs 2 lakh is deductible under Section 24(b). The principal repayment also counts under Section 80C within the Rs 1.5 lakh limit. For a let-out property, the entire interest is deductible with no upper limit, making real estate investment particularly tax-efficient under the old regime.

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How to Use the Old Tax Regime Calculator

This calculator computes your total income tax under the old tax regime including all major deductions, cess, and surcharge by following these five steps.

Enter your gross annual salary: Use the salary slider to enter your total annual salary including basic, allowances, bonuses, and perquisites. Add any other income from interest, rental income, or freelance earnings.
Select your age category: Choose below 60, senior (60-80), or super senior (80+) to apply the correct slab rates for your age group.
Enter basic deductions on the Basic tab: Section 80C investments (EPF, PPF, ELSS, life insurance), 80D health insurance premiums, and NPS contributions under 80CCD(1B).
Switch to the Advanced tab for HRA and home loan: Enter your basic salary, HRA received, actual rent paid, city type (metro or non-metro), and home loan interest under Section 24(b). The calculator computes the HRA exemption automatically.
Review your complete tax summary: The result panel shows total tax, effective rate, monthly TDS, taxable income, Section 87A rebate, cess, surcharge, slab-by-slab breakdown, and a deduction breakdown showing how much each deduction saved you.

Click any input value to type a precise number instead of using the slider. The currency selector converts amounts to USD, EUR, GBP, or other currencies. Your inputs are saved automatically and restored the next time you visit. Use the Old vs New Tax Regime Calculator to compare both regimes side by side with your specific income and deduction amounts.

Frequently Asked Questions

The old tax regime is the traditional Indian income tax system that allows taxpayers to claim deductions under Chapter VI-A and various exemptions. It has higher progressive tax rates of 0%, 5%, 20%, and 30% across four slabs, but permits substantial deductions through Section 80C, 80D, HRA exemption, home loan interest under Section 24(b), and standard deduction of Rs 50,000. Taxpayers earning above Rs 50 lakh also pay surcharge.

Disclaimer: All calculations on this page are indicative only. Tax laws and slabs may change with the Union Budget. This calculator uses the old tax regime rules as applicable for FY 2026-27. Actual tax liability depends on your specific income, deductions, and exemptions. Consult a qualified chartered accountant or tax professional for personalised tax planning. CAs can use Fermor CA Portal to generate detailed Tax Optimization Reports for clients.