Comprehensive Income Tax Slab Comparison (FY 2026–27 / AY 2027–28)
In India, personal income tax is levied based on progressive tax slabs. For Financial Year 2026–27 (relevant to Assessment Year 2027–28), taxpayers can choose between two tax systems: the default New Tax Regime (with lower slab rates but minimal exemptions) and the Old Tax Regime (with higher slab rates but extensive deduction allowances under Sections 80C, 80D, 24b, and 10(13A) HRA).
1. New Tax Regime Slabs (FY 2026–27 / Default)
The New Tax Regime is the default regime under Section 115BAC of the Income Tax Act. It features wider income brackets and lower marginal rates:
| Taxable Income Slab (₹) | Income Tax Rate | Remarks & Rebates |
|---|---|---|
| ₹0 – ₹4,00,000 | Nil (0%) | Basic Exemption Limit |
| ₹4,00,001 – ₹8,00,000 | 5% | Rebate u/s 87A available |
| ₹8,00,001 – ₹12,00,000 | 10% | Full Rebate u/s 87A if taxable income ≤ ₹12L |
| ₹12,00,001 – ₹16,00,000 | 15% | Marginal relief applies up to ₹12.75L taxable |
| ₹16,00,001 – ₹20,00,000 | 20% | - |
| ₹20,00,001 – ₹24,00,000 | 25% | - |
| Above ₹24,00,000 | 30% | Surcharge applies if income > ₹50 Lakh |
Note: Health and Education Cess of 4% is added to the computed tax liability across all slabs.
2. Old Tax Regime Slabs (FY 2026–27 / Optional)
The Old Tax Regime remains available for taxpayers wishing to claim itemized deductions (Section 80C, 80D, 80CCD(1B), HRA, home loan interest, etc.):
| Taxable Income Slab (₹) | Tax Rate (Individuals < 60 Yrs) | Senior Citizens (60–80 Yrs) |
|---|---|---|
| ₹0 – ₹2,50,000 | Nil | Nil (up to ₹3,00,000) |
| ₹2,50,001 – ₹5,00,000 | 5% | 5% (from ₹3L to ₹5L) |
| ₹5,00,001 – ₹10,00,000 | 20% | 20% |
| Above ₹10,00,000 | 30% | 30% |
3. Worked Examples Across Salary Levels
The table below shows tax computations across common annual CTC salary benchmarks under the New Tax Regime:
| Gross Salary | Std Deduction | Taxable Income | Gross Tax Before Rebate | Rebate u/s 87A | Total Tax + Cess |
|---|---|---|---|---|---|
| ₹10,00,000 | ₹75,000 | ₹9,25,000 | ₹32,500 | ₹32,500 | ₹0 |
| ₹12,75,000 | ₹75,000 | ₹12,00,000 | ₹60,000 | ₹60,000 | ₹0 |
| ₹15,00,000 | ₹75,000 | ₹14,25,000 | ₹93,750 | ₹0 | ₹97,500 |
| ₹20,00,000 | ₹75,000 | ₹19,25,000 | ₹1,85,000 | ₹0 | ₹1,92,400 |
For a detailed breakdown of individual salary brackets, read our salary guides for ₹10 Lakh CTC and ₹15 Lakh CTC.
4. Decision Framework: Old vs New Regime
Because the New Tax Regime offers lower rates across all brackets and a larger ₹75,000 standard deduction, the Old Tax Regime is advantageous only if you claim significant itemized exemptions:
- Section 80C: Up to ₹1,50,000 (EPF, PPF, ELSS, Life Insurance).
- Section 80D: Up to ₹25,000 to ₹50,000 for Health Insurance premiums.
- Section 24b: Up to ₹2,00,000 for Home Loan interest on self-occupied property.
- Section 10(13A): House Rent Allowance (HRA) exemption.
- Section 80CCD(1B): Additional ₹50,000 for National Pension System (NPS).
If your total deductions are below ₹3,75,000 per year, the New Tax Regime almost invariably results in higher monthly take-home pay with zero investment lock-in requirements.
Editorial Transparency & Source Standards
Effective Date: 1 April 2026 (Assessment Year 2027–28)
Last Reviewed: 19 September 2026
Reviewed by: SmartPaisa Tools Tax Research Team
Official Sources: Income Tax Department of India, Finance Act 2025/2026 provisions.
Read our Editorial Guidelines and Calculation Methodology.