{"id":16775,"date":"2026-03-12T03:59:33","date_gmt":"2026-03-12T10:29:33","guid":{"rendered":"https:\/\/shoonya.com\/blog\/?p=16775"},"modified":"2026-03-31T00:08:41","modified_gmt":"2026-03-31T06:38:41","slug":"income-tax-slabs-2025-26","status":"publish","type":"post","link":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/","title":{"rendered":"Income Tax Slabs for FY 2025-26 (AY26-27): New Vs Old Regime"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_87 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\"><p class=\"ez-toc-title\" style=\"cursor:inherit\"><\/p>\n<\/div><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Tax_Slab_2025-26_Key_Highlights\" >Tax Slab 2025-26: Key Highlights<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#New_Income_Tax_Slabs_FY_2025%E2%80%9326\" >New Income Tax Slabs (FY 2025\u201326)&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#How_Income_Tax_Is_Calculated_Using_Slabs\" >How Income Tax Is Calculated Using Slabs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#What_Is_Marginal_Relief\" >What Is Marginal Relief?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Old_Income_Tax_Slabs_FY_2025%E2%80%9326\" >Old Income Tax Slabs (FY 2025\u201326)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Comparison_Between_Old_and_New_Tax_Regime\" >Comparison Between Old and New Tax Regime<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Which_Tax_Regime_Is_Better_for_%E2%82%B915_Lakh_Income\" >Which Tax Regime Is Better for \u20b915 Lakh Income?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Does_the_New_Tax_Regime_Apply_to_All_Individuals\" >Does the New Tax Regime Apply to All Individuals?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Income_Tax_Slabs_for_Different_Taxpayers\" >Income Tax Slabs for Different Taxpayers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Surcharge_and_Health_Education_Cess\" >Surcharge and Health &amp; Education Cess<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#What_are_the_Different_Types_of_Taxable_Income_in_India\" >What are the Different Types of Taxable Income in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Tax-Saving_Investments_to_Reduce_Your_Tax_Liability\" >Tax-Saving Investments to Reduce Your Tax Liability<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#What_are_the_Changes_in_Securities_Transaction_Tax_STT_in_Budget_2026\" >What are the Changes in Securities Transaction Tax (STT) in Budget 2026<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#What_are_the_Changes_in_ITR_Filing_Deadlines_and_Penalties_for_AY_2026-27\" >What are the Changes in ITR Filing Deadlines and Penalties\u00a0for AY 2026-27<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Things_to_Consider_for_Choosing_Between_the_Old_and_New_Tax_Regime\" >Things to Consider for Choosing Between the Old and New Tax Regime<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Conclusion\" >Conclusion<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#Income_Tax_Slabs_and_Tax_Regime_FAQs\" >Income Tax Slabs and Tax Regime | FAQs<\/a><\/li><\/ul><\/nav><\/div>\n<div class=\"yoast-breadcrumbs\"><span><span><a href=\"https:\/\/shoonya.com\/blog\/\">Home<\/a><\/span> \u00bb <span><a href=\"https:\/\/shoonya.com\/blog\/personal-finance\/\">Personal Finance<\/a><\/span> \u00bb <span><a href=\"https:\/\/shoonya.com\/blog\/personal-finance\/tax\/\">Tax<\/a><\/span> \u00bb <span class=\"breadcrumb_last\" aria-current=\"page\"><strong>Income Tax Slabs for FY 2025-26 (AY26-27): New Vs Old Regime<\/strong><\/span><\/span><\/div>\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Income tax slabs determine how different portions of your taxable income are taxed. India follows a progressive tax system, which means the tax rate increases as income moves into higher slabs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In the Union Budget 2026 presented by Finance Minister Nirmala Sitharaman, there was no change in the income tax slabs, and the government retained the existing slabs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For FY 2025\u201326 (AY 2026\u201327), taxable income is divided into multiple slabs with tax rates ranging from 0% to 30%. In this blog, we will clarify the latest income tax slabs and rates that can help you estimate your tax liability and make better financial decisions during the year.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tax_Slab_2025-26_Key_Highlights\"><\/span>Tax Slab 2025-26: Key Highlights<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The new tax regime aims to simplify the tax structure by offering lower tax rates across multiple income brackets while reducing the number of deductions and exemptions.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Default tax system:<\/strong> The new tax regime is now the default option for individual taxpayers.<br><\/li>\n\n\n\n<li><strong>Lower tax rates:<\/strong> Income is taxed across multiple slabs with rates ranging from 0% to 30%.<br><\/li>\n\n\n\n<li><strong>Limited deductions:<\/strong> Most deductions, such as Section 80C, HRA, and LTA, are not available.<br><\/li>\n\n\n\n<li><strong>Standard deduction available:<\/strong> Salaried taxpayers continue to get a standard deduction, and PIB stated that the no-tax threshold is \u20b912.75 lakh for salaried taxpayers due to the \u20b975,000 standard deduction.\u00a0<br><\/li>\n\n\n\n<li><strong>Simpler tax calculation:<\/strong> With fewer exemptions and deductions, the tax structure becomes easier to understand and calculate.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>The Income Tax Rules, 2026: <\/strong>Notified on 20th March 2026 and came into effect from 1st April 2026, meaning they apply to the Tax Year 2026-27 (not FY 2025-26\/AY 2026-27).<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"New_Income_Tax_Slabs_FY_2025%E2%80%9326\"><\/span>New Income Tax Slabs (FY 2025\u201326)&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Taxable Income<\/strong><\/td><td><strong>Tax Rate<\/strong><\/td><\/tr><tr><td>Up to \u20b94,00,000<\/td><td>Nil<\/td><\/tr><tr><td>\u20b94,00,001 \u2013 \u20b98,00,000<\/td><td>5%<\/td><\/tr><tr><td>\u20b98,00,001 \u2013 \u20b912,00,000<\/td><td>10%<\/td><\/tr><tr><td>\u20b912,00,001 \u2013 \u20b916,00,000<\/td><td>15%<\/td><\/tr><tr><td>\u20b916,00,001 \u2013 \u20b920,00,000<\/td><td>20%<\/td><\/tr><tr><td>\u20b920,00,001 \u2013 \u20b924,00,000<\/td><td>25%<\/td><\/tr><tr><td>Above \u20b924,00,000<\/td><td>30%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_Income_Tax_Is_Calculated_Using_Slabs\"><\/span>How Income Tax Is Calculated Using Slabs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">India follows a <strong>progressive tax system<\/strong>, which means different portions of your income are taxed at different rates depending on the slab they fall into.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Instead of taxing your entire income at a single rate, the income is divided across slabs, and each slab is taxed separately.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Example<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Suppose your <strong>taxable income is \u20b910,00,000<\/strong> under the new tax regime.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Income Portion<\/strong><\/td><td><strong>Tax Rate<\/strong><\/td><td><strong>Tax Amount<\/strong><\/td><\/tr><tr><td>Up to \u20b94,00,000<\/td><td>0%<\/td><td>\u20b90<\/td><\/tr><tr><td>\u20b94,00,001 \u2013 \u20b98,00,000<\/td><td>5%<\/td><td>\u20b920,000<\/td><\/tr><tr><td>\u20b98,00,001 \u2013 \u20b910,00,000<\/td><td>10%<\/td><td>\u20b920,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Total Tax Payable: \u20b940,000<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This structure ensures that only the portion of income falling within a specific slab is taxed at that slab\u2019s rate.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">But, Is Income Up to \u20b912 Lakh Tax-Free?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Under the new tax regime for FY 2025-26, slab rates still apply as usual. However, the government also provides a rebate that can reduce the final tax liability for eligible resident individuals.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">PIB clarified that there will be no income tax payable up to \u20b912 lakh under the new regime, other than special-rate income such as capital gains. For salaried taxpayers, this effective limit is \u20b912.75 lakh due to the \u20b975,000 standard deduction.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This does <strong>not<\/strong> mean that slab rates become zero up to \u20b912 lakh. It means the tax computed under the slab system can be neutralised by the rebate, subject to eligibility.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">What if your income slightly increases above 12 Lakh? Here comes marginal relief!<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Is_Marginal_Relief\"><\/span>What Is Marginal Relief?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">If a resident individual\u2019s income slightly exceeds the rebate threshold, the tax payable can rise sharply because the rebate is no longer fully available. Marginal relief helps ensure that the extra tax payable does not exceed the amount by which income exceeds the rebate threshold.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For example, if taxable income is just above \u20b912 lakh under the new regime, marginal relief may reduce the excess tax burden so that the tax increase is not disproportionate to the additional income.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Example<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Suppose a taxpayer has a taxable income of \u20b912,10,000.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Without marginal relief, the tax calculated under the slab rates could be significantly higher than the additional \u20b910,000 income above \u20b912 lakh, creating a disproportionate tax burden.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With marginal relief applied, the tax payable is adjusted so that the increase in tax does not exceed the additional income earned above \u20b912 lakh.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Without marginal relief:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Tax calculated under slabs may exceed the additional \u20b910,000 income.<\/li>\n\n\n\n<li>This would create an unfairly high tax burden.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">With marginal relief applied, the tax payable will be adjusted so that the additional tax does not exceed the income earned above \u20b912 lakh.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Old_Income_Tax_Slabs_FY_2025%E2%80%9326\"><\/span>Old Income Tax Slabs (FY 2025\u201326)<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Under the old regime, income is taxed using the following slab rates for individuals below 60 years of age.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Taxable Income<\/strong><\/td><td><strong>Tax Rate<\/strong><\/td><\/tr><tr><td>Up to \u20b92,50,000<\/td><td>Nil<\/td><\/tr><tr><td>\u20b92,50,001 \u2013 \u20b95,00,000<\/td><td>5%<\/td><\/tr><tr><td>\u20b95,00,001 \u2013 \u20b910,00,000<\/td><td>20%<\/td><\/tr><tr><td>Above \u20b910,00,000<\/td><td>30%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Under the old regime, senior citizens and super senior citizens may have higher basic exemption limits, unlike the new regime, where uniform slab rates apply.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Comparison_Between_Old_and_New_Tax_Regime\"><\/span>Comparison Between Old and New Tax Regime<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Taxpayers in India can choose between the old tax regime and the new tax regime when filing their income tax returns. The main difference lies in tax rates and eligibility for deductions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While the new tax regime offers lower tax rates across multiple slabs, it removes most deductions and exemptions. The old tax regime, on the other hand, allows taxpayers to claim several deductions that can reduce taxable income.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Feature<\/strong><\/td><td><strong>Old Tax Regime<\/strong><\/td><td><strong>New Tax Regime<\/strong><\/td><\/tr><tr><td>Tax Slabs<\/td><td>Fewer slabs with higher rates<\/td><td>More slabs with lower rates<\/td><\/tr><tr><td>Deductions &amp; Exemptions<\/td><td>Available (80C, 80D, HRA, LTA etc.)<\/td><td>Mostly not allowed<\/td><\/tr><tr><td>Standard Deduction<\/td><td>Available<\/td><td>Available<\/td><\/tr><tr><td>Default Tax System<\/td><td>No<\/td><td>Yes<\/td><\/tr><tr><td>Best Suited For<\/td><td>Taxpayers claiming multiple deductions<\/td><td>Taxpayers preferring simpler taxation<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Which_Tax_Regime_Is_Better_for_%E2%82%B915_Lakh_Income\"><\/span>Which Tax Regime Is Better for \u20b915 Lakh Income?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">For taxpayers earning around \u20b915 lakh annually, choosing between the old tax regime and the new tax regime depends largely on the deductions and exemptions they can claim.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Example Comparison for \u20b915 Lakh Income<\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Particulars<\/strong><\/td><td><strong>Old Tax Regime<\/strong><\/td><td><strong>New Tax Regime<\/strong><\/td><\/tr><tr><td>Annual Income<\/td><td>\u20b915,00,000<\/td><td>\u20b915,00,000<\/td><\/tr><tr><td>Deductions (Example)<\/td><td>\u20b92,00,000<\/td><td>Not applicable<\/td><\/tr><tr><td>Taxable Income<\/td><td>\u20b913,00,000<\/td><td>\u20b915,00,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">Estimated Tax Calculation<\/h3>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Regime<\/strong><\/td><td><strong>Approx. Tax Payable*<\/strong><\/td><\/tr><tr><td>Old Tax Regime<\/td><td>\u20b91,72,500<\/td><\/tr><tr><td>New Tax Regime<\/td><td>\u20b91,20,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>So, which one works better for an \u20b915 Lakh income?<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The new tax regime may be beneficial if you do not claim many deductions.<\/li>\n\n\n\n<li>The old tax regime may work better if you regularly claim deductions such as 80C investments, insurance premiums, and housing-related benefits.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Note: <\/em><\/strong><em>The final choice depends on how much they invest in tax-saving instruments and the exemptions they are eligible to claim.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Does_the_New_Tax_Regime_Apply_to_All_Individuals\"><\/span>Does the New Tax Regime Apply to All Individuals?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The new tax regime under section 115BAC is the default regime for individuals and HUFs. Taxpayers can still opt for the old regime if it is more beneficial.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Salaried taxpayers can generally review this choice while filing their return each year. Those with business or professional income may face restrictions on switching frequently. Other taxpayers, such as companies, LLPs, firms, and trusts, follow separate tax provisions.&nbsp;&nbsp;<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Individuals and HUFs<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The new tax regime is the default option for individuals and HUF taxpayers.<\/li>\n\n\n\n<li>Taxpayers can still opt for the old tax regime if they want to claim deductions and exemptions.<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Salaried Individuals<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Salaried taxpayers are automatically placed under the new tax regime by default.<\/li>\n\n\n\n<li>They can switch to the old regime while filing their income tax return if deductions such as HRA, Section 80C, or home loan interest provide greater tax benefits.<br><\/li>\n<\/ul>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Business or Professional Income<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Individuals earning business or professional income can also opt for the new regime.<br><\/li>\n\n\n\n<li>However, once they choose to switch back to the old regime, the option to change regimes may be restricted under certain conditions.<br><\/li>\n<\/ul>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>Other Taxpayers<\/strong><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">Entities such as companies, partnership firms, LLPs, and trusts follow separate tax rate structures and provisions under the Income Tax Act.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Income_Tax_Slabs_for_Different_Taxpayers\"><\/span>Income Tax Slabs for Different Taxpayers<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Income tax rules in India differ depending on the type of taxpayer. While individual taxpayers follow the slab-based system under the old or new tax regime, other entities such as firms, companies, and special bodies are taxed according to separate provisions under the Income Tax Act.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">1. Individual \/ HUF<\/h3>\n\n\n\n<h4 class=\"wp-block-heading\">. Salaried Employees<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Salaried individuals are taxed under the income tax slab system, either under the old or the new tax regime. They can choose between claiming deductions or opting for lower tax rates.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Learn more about the <a href=\"https:\/\/shoonya.com\/blog\/income-tax-for-salaried-employees\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/income-tax-for-salaried-employees\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Income Tax for Salaried Employees<\/mark><\/a>!<\/em><\/strong><\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Business \/ Profession<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Income from business or professional activities is taxed under \u201cProfits and Gains from Business or Profession.\u201d It follows the same slab rates as individuals, with options like presumptive taxation (Sections 44AD, 44ADA) available.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Senior \/ Super Senior Citizens<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Senior citizens (60\u201379 years) and super senior citizens (80+ years) enjoy higher basic exemption limits under the old tax regime. However, under the new tax regime, uniform slab rates apply regardless of age.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Non-Resident Individuals (NRIs)<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">NRIs are taxed only on income earned or received in India. While slab rates are similar to those of residents, certain deductions and benefits may be restricted.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Hindu Undivided Family (HUF)<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">An HUF is treated as a separate taxable entity and is taxed under the same slab structure as individuals, with the ability to claim deductions independently of its members.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. Company<\/h3>\n\n\n\n<h4 class=\"wp-block-heading\">. Domestic Company<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Domestic companies are taxed under corporate tax rates as specified under the Income Tax Act. They may opt for different concessional tax regimes based on eligibility.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Foreign Company<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Foreign companies are taxed on income earned in India, with tax rates generally higher than those of domestic companies, along with applicable surcharges and cesses.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. Non-Company<\/h3>\n\n\n\n<h4 class=\"wp-block-heading\">. AOP \/ BOI \/ Trust \/ AJP<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Entities such as Associations of Persons (AOP), Bodies of Individuals (BOI), Trusts, and Artificial Juridical Persons (AJP) are taxed under specific provisions, depending on how income is structured and distributed.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Firm \/ LLP<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Partnership firms and LLPs are taxed at a flat rate on total income, along with surcharge and cess. They do not follow the individual slab system.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">. Local Authority<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Local authorities such as municipalities and statutory bodies are taxed under special provisions defined in the Income Tax Act.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Make tax filing easier for traders with<\/em><\/strong> <strong><a href=\"https:\/\/shoonya.com\/blog\/shoonya-with-quicko\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/shoonya-with-quicko\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Shoonya + Quicko<\/mark><\/a><\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Surcharge_and_Health_Education_Cess\"><\/span>Surcharge and Health &amp; Education Cess<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Apart from the income tax calculated under the applicable slab rates, taxpayers may also need to pay additional charges such as surcharge and health &amp; education cess, depending on their total income.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">These components increase the final tax liability and are applied after the base income tax is calculated.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What Is Surcharge?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">A surcharge is an additional tax imposed on individuals whose income exceeds certain thresholds. It is calculated as a percentage of the income tax payable.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Surcharge Rates for Individual Taxpayers<\/h4>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Total Income<\/strong><\/td><td><strong>Surcharge Rate<\/strong><\/td><\/tr><tr><td>\u20b950 lakh \u2013 \u20b91 crore<\/td><td>10%<\/td><\/tr><tr><td>\u20b91 crore \u2013 \u20b92 crore<\/td><td>15%<\/td><\/tr><tr><td>\u20b92 crore \u2013 \u20b95 crore<\/td><td>25%<\/td><\/tr><tr><td>Above \u20b95 crore<\/td><td>37% (subject to conditions under tax regimes)<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Surcharge is calculated on the income tax payable after applying the slab rates.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What Is Health and Education Cess?<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">In addition to income tax and surcharge, taxpayers must also pay a Health and Education Cess of 4% on the total tax amount.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This cess is used by the government to fund healthcare and education initiatives.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Example<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If your calculated income tax is \u20b91,00,000:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Health &amp; Education Cess (4%) = \u20b94,000<\/li>\n\n\n\n<li>Total tax payable = \u20b91,04,000<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Different_Types_of_Taxable_Income_in_India\"><\/span>What are the Different Types of Taxable Income in India<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Under the Income Tax Act, income is classified into different categories, and each category is taxed according to the applicable rules and provisions.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"> 1. Income from Salary<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">This includes the income employees receive from their employer.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Common components include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Basic salary<\/li>\n\n\n\n<li>Dearness allowance<\/li>\n\n\n\n<li>House rent allowance (HRA)<\/li>\n\n\n\n<li>Bonuses and incentives<\/li>\n\n\n\n<li>Leave encashment<\/li>\n\n\n\n<li>Pension<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Certain deductions and exemptions may apply depending on the tax regime chosen by the taxpayer.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. Income from House Property<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Income earned from owning and renting out property is taxed under this category.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This may include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Rental income from residential or commercial properties<\/li>\n\n\n\n<li>Deemed rent from certain properties<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Taxpayers may also claim deductions such as home loan interest under the applicable regime.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. Income from Business or Profession<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Income generated through business activities or professional services is taxed under this category.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Examples include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Business profits<\/li>\n\n\n\n<li>Freelance income<\/li>\n\n\n\n<li>Professional fees<\/li>\n\n\n\n<li>Consultancy income<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">4. Income from Capital Gains<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Capital gains arise when a taxpayer sells a capital asset at a profit.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Examples of capital assets include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Shares and mutual funds<\/li>\n\n\n\n<li>Real estate<\/li>\n\n\n\n<li>Gold or other investments<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Capital gains may be classified as short-term or long-term, depending on the holding period.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">5. Income from Other Sources<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Any income that does not fall under the previous categories is taxed under income from other sources.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Examples include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Interest income from savings accounts or fixed deposits<\/li>\n\n\n\n<li>Dividend income<\/li>\n\n\n\n<li>Lottery winnings<\/li>\n\n\n\n<li>Gifts received beyond the permitted limit<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tax-Saving_Investments_to_Reduce_Your_Tax_Liability\"><\/span>Tax-Saving Investments to Reduce Your Tax Liability<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Most of these deductions are relevant mainly under the <strong>old tax regime<\/strong>, since the new regime allows only limited deductions and exemptions<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Investment Option<\/strong><\/td><td><strong>Section<\/strong><\/td><td><strong>Maximum Deduction<\/strong><\/td><\/tr><tr><td>Public Provident Fund (PPF)<\/td><td>80C<\/td><td>Up to \u20b91.5 lakh<\/td><\/tr><tr><td>Equity Linked Savings Scheme (ELSS)<\/td><td>80C<\/td><td>Up to \u20b91.5 lakh<\/td><\/tr><tr><td>National Savings Certificate (NSC)<\/td><td>80C<\/td><td>Up to \u20b91.5 lakh<\/td><\/tr><tr><td>Tax-Saving Fixed Deposits<\/td><td>80C<\/td><td>Up to \u20b91.5 lakh<\/td><\/tr><tr><td>National Pension System (NPS)<\/td><td>80CCD(1B)<\/td><td>Additional \u20b950,000<\/td><\/tr><tr><td>Life Insurance Premium<\/td><td>80C<\/td><td>Up to \u20b91.5 lakh<\/td><\/tr><tr><td>Health Insurance Premium<\/td><td>80D<\/td><td>Up to \u20b925,000\u2013\u20b950,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Changes_in_Securities_Transaction_Tax_STT_in_Budget_2026\"><\/span>What are the Changes in Securities Transaction Tax (STT) in Budget 2026<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Union Budget 2026 also introduced certain revisions to the Securities Transaction Tax (STT) structure applicable to transactions in the stock market. STT is a tax levied on the purchase and sale of securities such as equities, equity derivatives, and mutual fund units traded on recognised stock exchanges.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">These changes aim to align the tax framework with evolving market activity while ensuring transparency in securities transactions.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Key Changes in STT<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Revised STT rates on certain derivative transactions to reflect increased trading volumes in options and futures.<br><\/li>\n\n\n\n<li>Adjustments in STT on options contracts, particularly on the premium component during sale transactions.<br><\/li>\n\n\n\n<li>Continued application of STT on equity delivery trades, intraday equity trades, and derivatives executed on recognised exchanges.<br><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><a href=\"https:\/\/shoonya.com\/blog\/securities-transaction-taxstt-everything-you-need-to-know\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/securities-transaction-taxstt-everything-you-need-to-know\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">STT<\/mark><\/a> and <a href=\"https:\/\/shoonya.com\/blog\/capital-gain-tax-rules-for-investment\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/capital-gain-tax-rules-for-investment\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Capital Gains Tax<\/mark><\/a><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It is important to note that STT is separate from capital gains tax. While STT is charged on every eligible transaction executed on an exchange, capital gains tax is calculated on the profit earned from selling securities.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_Changes_in_ITR_Filing_Deadlines_and_Penalties_for_AY_2026-27\"><\/span>What are the Changes in ITR Filing Deadlines and Penalties\u00a0for AY 2026-27<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Union Budget 2026 also introduced changes related to Income Tax Return (ITR) filing timelines and penalties, aimed at improving compliance and encouraging taxpayers to file returns within the prescribed deadlines.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Revised ITR Filing Deadlines<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The due dates for filing income tax returns generally remain aligned with taxpayer categories:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Category of Taxpayer<\/strong><\/td><td><strong>Due Date for Filing ITR<\/strong><\/td><\/tr><tr><td>Individuals and HUFs (not requiring audit)<\/td><td>31 July 2026<\/td><\/tr><tr><td>Businesses requiring an audit<\/td><td>31 October 2026<\/td><\/tr><tr><td>Transfer pricing cases<\/td><td>30 November 2026<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Taxpayers are encouraged to file their returns before the due date to avoid penalties and ensure timely processing of refunds.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Updated Return and Revised Return Deadlines<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Taxpayers who discover errors or omissions after filing their ITR can submit a <strong>revised return<\/strong> within the permitted timeframe.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Type of Return<\/strong><\/td><td><strong>Deadline<\/strong><\/td><\/tr><tr><td>Belated Return<\/td><td>31 December 2026 or before completion of assessment, whichever is earlier<\/td><\/tr><tr><td>Revised Return<\/td><td>31 March 2027 or before completion of assessment, whichever is earlier<\/td><\/tr><tr><td>Updated Return (ITR-U)<\/td><td>Within the time allowed under the law<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">This allows taxpayers additional time to correct mistakes or disclose previously omitted income.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Penalty for Late Filing of ITR<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Failing to file an income tax return within the due date may attract a late filing fee under Section 234F.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Total Income<\/strong><\/td><td><strong>Late Filing Fee<\/strong><\/td><\/tr><tr><td>Up to \u20b95 lakh<\/td><td>\u20b91,000<\/td><\/tr><tr><td>Above \u20b95 lakh<\/td><td>\u20b95,000<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">In addition to the late filing fee, taxpayers may also need to pay <strong>interest under Section 234A<\/strong> on any unpaid tax liability.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>After calculating your tax using the FY 2025-26 tax slabs, don\u2019t forget the <a href=\"https:\/\/shoonya.com\/blog\/advance-tax-deadline\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/advance-tax-deadline\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">advance tax deadline<\/mark><\/a><\/strong>\u2014<strong><em>missing it may lead to a penalty and interest.<\/em><\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Things_to_Consider_for_Choosing_Between_the_Old_and_New_Tax_Regime\"><\/span>Things to Consider for Choosing Between the Old and New Tax Regime<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Here are some practical tips to help decide which regime may work better.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>1. Evaluate Your Deductions<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you regularly claim deductions such as:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Section 80C investments (PPF, ELSS, insurance)<br><\/li>\n\n\n\n<li>Health insurance under Section 80D<br><\/li>\n\n\n\n<li>Home loan interest<br><\/li>\n\n\n\n<li>House Rent Allowance (HRA)<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The old tax regime may provide greater tax savings.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>2. Consider Simplicity of Tax Filing<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The new tax regime simplifies tax calculation because most deductions and exemptions are not applicable. This makes it easier for taxpayers who prefer a straightforward tax structure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>3. Compare Tax Liability Under Both Regimes<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Before filing your income tax return, it is advisable to calculate tax liability under both regimes. Many taxpayers choose the option that results in lower overall tax payable.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>4. Review Your Investment Strategy<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Tax-saving investments are an important factor. If you actively invest in instruments such as PPF, ELSS, or NPS, the old regime might provide better benefits.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>5. <strong>Review your choice at the time of filing:<\/strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Salaried taxpayers generally have the flexibility to compare both regimes each year, while taxpayers with business or professional income may face restrictions on switching.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em>Looking for last year\u2019s tax rates? Read our guide on<\/em><\/strong> <strong><a href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs\/\" type=\"link\" id=\"https:\/\/shoonya.com\/blog\/income-tax-slabs\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Income Tax Slabs in India for AY 2024-25<\/mark><\/a><\/strong>.<br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">For FY 2025-26, taxpayers should compare the old and new tax regimes carefully instead of assuming one is always better. The revised new-regime slabs, rebate benefit, standard deduction for salaried taxpayers, and the availability of deductions under the old regime can all materially change the final tax outgo. Choosing the right regime after comparing actual tax liability is the most practical approach.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Income_Tax_Slabs_and_Tax_Regime_FAQs\"><\/span>Income Tax Slabs and Tax Regime | FAQs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1773300006963\"><strong class=\"schema-faq-question\">Can we change the tax regime while filing ITR?<\/strong> <p class=\"schema-faq-answer\">Yes, salaried individuals can choose between the old and new tax regimes while filing their income tax return. However, individuals with business or professional income may face restrictions on switching regimes frequently.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773300007744\"><strong class=\"schema-faq-question\">Which tax regime is better for \u20b912 lakh income?<\/strong> <p class=\"schema-faq-answer\">The better regime depends on the deductions and exemptions a taxpayer can claim, such as Section 80C investments, health insurance, or home loan interest; the old tax regime may be beneficial. If deductions are limited, the new tax regime with lower slab rates may result in lower tax liability.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773300008320\"><strong class=\"schema-faq-question\">What is the difference between Financial Year (FY) and Assessment Year (AY)?<\/strong> <p class=\"schema-faq-answer\">Financial Year (FY) is the year in which income is earned. Assessment Year (AY) is the year in which that income is assessed and taxed. For example, Income earned during FY 2025\u201326 is assessed in AY 2026\u201327.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773300800701\"><strong class=\"schema-faq-question\">Does the new tax regime apply to all taxpayers?<\/strong> <p class=\"schema-faq-answer\">The new tax regime mainly applies to individuals and Hindu Undivided Families (HUFs). Other entities, such as companies, LLPs, and partnership firms, follow separate tax rate provisions under the Income Tax Act.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773300812637\"><strong class=\"schema-faq-question\">What is the rebate under Section 87A?<\/strong> <p class=\"schema-faq-answer\">Section 87A provides a rebate to eligible resident individuals whose income falls within the prescribed limit. Under the new regime for FY 2025-26, the rebate can reduce the tax payable to zero up to the notified threshold, subject to conditions and excluding special-rate income such as capital gains.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1773300824070\"><strong class=\"schema-faq-question\">Is the old tax regime still available?<\/strong> <p class=\"schema-faq-answer\">Yes, the old tax regime is still available, allowing taxpayers to claim deductions and exemptions such as Section 80C, HRA, and health insurance deductions. Taxpayers can choose the regime that results in lower tax liability.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1774939109264\"><strong class=\"schema-faq-question\">Has Budget 2026 changed the slab rates for FY 2025-26?<\/strong> <p class=\"schema-faq-answer\">No, the slab changes relevant to FY 2025-26 (AY 2026-27) were announced in the Union Budget 2025-26. A 2026 transition article should not describe those rates as a Budget 2026 change.<\/p> <\/div> <\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Source: <\/strong>https:\/\/www.pib.gov.in\/<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Disclaimer<\/mark>: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Income tax slabs determine how different portions of your taxable income are taxed. India follows a progressive tax system, which means the tax rate increases as income moves into higher slabs. In the Union Budget 2026 presented by Finance Minister Nirmala Sitharaman, there was no change in the income tax slabs, and the government retained &hellip; <a href=\"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Income Tax Slabs for FY 2025-26 (AY26-27): New Vs Old Regime&#8221;<\/span><\/a><\/p>\n","protected":false},"author":17,"featured_media":16777,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","_members_access_role":[],"_members_access_error":""},"categories":[764],"tags":[9515,9509,9514,3918,9508,9510,1385,3912,9513,9511,9512,9516,2738],"class_list":["post-16775","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tax","tag-can-we-change-tax-regime-while-filing-itr","tag-current-income-tax-slabs","tag-income-tax-slab-for-fy-2025-26","tag-income-tax-slabs","tag-income-tax-slabs-2025-26","tag-income-tax-slabs-and-rates-for-fy25-26-ay26-27","tag-new-tax-regime","tag-new-tax-regime-slabs","tag-new-tax-regime-tax-slabs","tag-new-tax-slabs","tag-tax-slab-for-fy-2025-26","tag-which-assessment-year-is-this","tag-which-tax-regime-is-better-for-15-lakhs"],"acf":[],"yoast_head":"<!-- This site is optimized with the 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However, individuals with business or professional income may face restrictions on switching regimes frequently.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300007744","position":2,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300007744","name":"Which tax regime is better for \u20b912 lakh income?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"The better regime depends on the deductions and exemptions a taxpayer can claim, such as Section 80C investments, health insurance, or home loan interest; the old tax regime may be beneficial. If deductions are limited, the new tax regime with lower slab rates may result in lower tax liability.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300008320","position":3,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300008320","name":"What is the difference between Financial Year (FY) and Assessment Year (AY)?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"Financial Year (FY) is the year in which income is earned. Assessment Year (AY) is the year in which that income is assessed and taxed. For example, Income earned during FY 2025\u201326 is assessed in AY 2026\u201327.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300800701","position":4,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300800701","name":"Does the new tax regime apply to all taxpayers?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"The new tax regime mainly applies to individuals and Hindu Undivided Families (HUFs). Other entities, such as companies, LLPs, and partnership firms, follow separate tax rate provisions under the Income Tax Act.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300812637","position":5,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300812637","name":"What is the rebate under Section 87A?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"Section 87A provides a rebate to eligible resident individuals whose income falls within the prescribed limit. Under the new regime for FY 2025-26, the rebate can reduce the tax payable to zero up to the notified threshold, subject to conditions and excluding special-rate income such as capital gains.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300824070","position":6,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1773300824070","name":"Is the old tax regime still available?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"Yes, the old tax regime is still available, allowing taxpayers to claim deductions and exemptions such as Section 80C, HRA, and health insurance deductions. Taxpayers can choose the regime that results in lower tax liability.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1774939109264","position":7,"url":"https:\/\/shoonya.com\/blog\/income-tax-slabs-2025-26\/#faq-question-1774939109264","name":"Has Budget 2026 changed the slab rates for FY 2025-26?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"No, the slab changes relevant to FY 2025-26 (AY 2026-27) were announced in the Union Budget 2025-26. A 2026 transition article should not describe those rates as a Budget 2026 change.","inLanguage":"en-US"},"inLanguage":"en-US"}]}},"_links":{"self":[{"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/posts\/16775","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/comments?post=16775"}],"version-history":[{"count":14,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/posts\/16775\/revisions"}],"predecessor-version":[{"id":16914,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/posts\/16775\/revisions\/16914"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/media\/16777"}],"wp:attachment":[{"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/media?parent=16775"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/categories?post=16775"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/shoonya.com\/blog\/wp-json\/wp\/v2\/tags?post=16775"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}