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Old vs New Tax Regime: Which is Better in FY 2026-27?
Our Expert Verdict for 2026
For most salaried Indians earning ₹8L–₹20L, the New Regime saves more tax in FY 2026-27 due to the higher standard deduction of ₹75,000 and the effectively tax-free limit of ₹12L. However, if your Old Regime deductions (HRA + 80C + 80D) exceed ₹3.75L, the Old Regime may still win.
| Feature | Old Tax Regime | New Tax Regime |
|---|---|---|
| Basic Exemption | ₹2.5 Lakh | ₹3.0 Lakh |
| Standard Deduction | ₹50,000 | ₹75,000 |
| 80C Deductions (PPF/ELSS) | Allowed (up to ₹1.5L) | Not Allowed |
| HRA Exemption | Allowed | Not Allowed |
| Section 87A Rebate | Up to ₹25,000 (Income < ₹5L) | Up to ₹60,000 (Income < ₹12L) |
Find your personal winner
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