Why income up to ₹12.75 lakh is tax-free for salaried people this year, how each slab is applied, and when the old regime still wins.
| Taxable income | Rate |
|---|---|
| Up to ₹4,00,000 | Nil |
| ₹4,00,001 – ₹8,00,000 | 5% |
| ₹8,00,001 – ₹12,00,000 | 10% |
| ₹12,00,001 – ₹16,00,000 | 15% |
| ₹16,00,001 – ₹20,00,000 | 20% |
| ₹20,00,001 – ₹24,00,000 | 25% |
| Above ₹24,00,000 | 30% |
Slabs are marginal: each rate applies only to the income inside that band, not to your whole income.
Section 87A gives a rebate of up to ₹60,000, which wipes out the tax on taxable income up to ₹12 lakh. Just above ₹12 lakh, marginal relief caps your tax at the amount by which income exceeds ₹12 lakh — so earning ₹10,000 more never costs more than ₹10,000 in tax. The rebate does not apply to special-rate income such as capital gains.
Taxable income = ₹15,00,000 − ₹75,000 = ₹14,25,000.
Tax = ₹93,750, plus 4% cess = ₹97,500 for the year, about ₹8,125 a month in TDS.
| Taxable income | Rate |
|---|---|
| Up to ₹2,50,000 | Nil |
| ₹2,50,001 – ₹5,00,000 | 5% |
| ₹5,00,001 – ₹10,00,000 | 20% |
| Above ₹10,00,000 | 30% |
The old regime keeps 80C (₹1.5 lakh), 80D, HRA, LTA and home-loan interest (₹2 lakh) but has a ₹50,000 standard deduction and a rebate only up to ₹5 lakh.
Compare both with your real deductions. As a rule of thumb, at ₹15 lakh salary you need more than roughly ₹5.4 lakh of deductions beyond the standard deduction (80C, 80D, HRA, home-loan interest together) before the old regime is cheaper. Use the tax regime comparison calculator to see the exact break-even for your numbers.
Open the Income Tax Calculator →
Surcharge is added to tax at 10% above ₹50 lakh, 15% above ₹1 crore and 25% above ₹2 crore (the new regime caps it at 25%). Marginal relief ensures crossing a threshold never costs more than the extra income.
