Income Tax Slab Rates for FY 2025-26 have changed under the new tax regime, making tax filing easier and more beneficial for many taxpayers. Further, there is also revision in the rebate limit under the New Tax Regime from ₹7,00,000 to ₹12,00,000. As a result, individuals earning up to ₹12,00,000 will pay zero tax after rebate.Â
These changes will help taxpayers save more money and reduce their tax burden. However, there are no changes in the Income Tax Rates under the old tax regime, allowing taxpayers to claim deductions.Â
💡 Important Note on Capital Gains Taxation: Â
If you have income from capital gains (such as selling stocks, property, or mutual funds), you must pay tax on it, even if your total income is below ₹12,00,000. The rebate under the new tax regime does not apply to capital gains.Â
So, which tax regime works best for you? Let’s break it down.Â
Income Tax Slab Rates for FY 2025-26: New Rates Under The Tax Regime
New Tax Regime (FY 2025-26)Â
The new tax rates under the new tax regime are as follows:Â
Income Slab (₹)
New Tax Rate (%)
0 – 4 lakh
Nil
4 – 8 lakh
5%
8 – 12 lakh
10%
12 – 16 lakh
15%
16 – 20 lakh
20%
20 – 24 lakh
25%
Above 24 lakh
30%
✅ Standard deduction of ₹75,000 for salaried individuals.Â
✅ Higher rebate limit of ₹12,00,000 (earlier ₹7,00,000).Â
✅ Lower tax rates, resulting in more savings.Â
Comparision of Old and New Rates Under The New Tax Regime
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Also Read: Income Tax Slab Rates for FY 2024-25
Slab Rates Under The Old Tax Regime (FY 2025-26)
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✅ Standard deduction of ₹50,000 for salaried individuals.Â
✅ Rebate limit of ₹5,00,000.Â
✅ Taxpayers can claim deductions under sections like 80C, 80D, and HRA.
How Much Tax Can You Save? (Comparison Table)
This table compares the tax payable under the old tax regime and the new rates under the new tax regime:Â
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(Deductions under Section 80C = ₹1,50,000, Section 80D = ₹25,000, Standard Deduction Under Old Tax Regime = ₹50,000, and Deduction Under New Tax Regime = ₹75,000)Â
💡 Key Takeaways:Â
– ₹12,00,000 or below → Zero tax as per the new rates under the new tax regime.Â
– Above ₹12,00,000 → ₹1,05,000 savings compared to the old new tax regime.Â
Which Tax Regime Should You Choose?
✅ Choose the new tax regime if:Â
– Your income is ₹12,00,000 or less, as you will pay zero tax.Â
– You do not claim many deductions and prefer a simpler tax structure.Â
– You want to reduce tax liability without investment constraints.Â
✅ Choose the old tax regime if:Â
– You claim deductions under 80C, 80D, or HRA.Â
– You invest in PPF, NPS, or home loan interest.Â
– Your taxable income is high, and deductions bring down your tax.Â
Capital Gains Taxation: Important Note
If you earn income from capital gains, the rebate of ₹12,00,000 does not apply.Â
🔹 Example:Â
If your salary is ₹10,00,000 (below ₹12L rebate limit) but you have ₹3,00,000 from capital gains, you must pay tax on the ₹3,00,000 as per capital gains tax rules.Â
Even though your total income is ₹13,00,000, only the salary part qualifies for the rebate.Â
Conclusion: If you have capital gains, the new rebate limit won’t eliminate your tax liability.Â
Important Pointers
✅ The government has raised the rebate limit to ₹12,00,000, helping many taxpayers pay zero tax.Â
✅ The new tax regime offers lower tax rates, leading to significant savings.Â
✅ Capital gains are taxable separately, even if total income is below ₹12,00,000.Â
✅ If you claim high deductions, then the old tax regime may work better.Â
Still confused about which tax regime to choose? Comment below, and we’ll help you decide! 🚀Â
If you want to plan your taxes, then you must act now and optimize your taxes with the help of TaxHelpdesk. Also, do not forget to follow us on Facebook, Instagram, LinkedIn and Twitter.Â