Most people answer the old-versus-new regime question once and move on.
About this calculator
Most people answer the old-versus-new regime question once and move on. The honest answer is dynamic: as your salary grows, the fixed rupee value of your 80C, 80D, HRA and home-loan interest deductions shrinks in proportion to total income, while the new regime's flatter slab structure starts to win. Somewhere between a two-year and a ten-year horizon, depending on your starting salary and growth rate, the ranking flips.
This calculator projects your salary forward at your expected growth rate, computes both regimes for each future fiscal year using the FY26-27 slabs, and reports the year the recommendation changes. It includes the 75,000 standard deduction now available under the new regime and the 50,000 standard deduction plus 80C, 80D, HRA and Section 24 under the old regime. Surcharge bands at 50 lakh, 1 crore, 2 crore and 5 crore are applied consistently so crossing those thresholds is captured.
The utility of the projection is planning your 80C locks. A PPF contribution made today locks for 15 years; ELSS for three; NPS for longer. If the crossover is in year four, you may not want to add 80C commitments that outlast the point where the deductions stop mattering. For a one-year snapshot use [[income-tax]]; to compare NPS, ELSS and PPF as instruments see [[lockin-comparator]].
Common uses
- Deciding whether to open a fresh PPF account at 12 lakh salary with 10% annual growth
- Planning the timing of home-loan prepayment versus keeping the Section 24 deduction alive
- Evaluating HRA restructuring in CTC for an employee near the regime crossover
- Projecting when a 25-lakh CTC earner should shift from old to new regime
- Comparing a consultant
Frequently asked questions
Can I switch between old and new regime every year?
Salaried taxpayers can choose each year when filing ITR-1 or ITR-2. Non-salaried taxpayers with business income pick once and are generally locked in unless they formally opt out, so they need to think longer-term before switching.
How do I know which regime is better for me?
Add up your old-regime deductions: 80C (up to 1.5 lakh), 80D (up to 75k with parents), HRA exemption, home-loan interest (up to 2 lakh), NPS 80CCD(1B) (50k). If the total crosses 3.5 to 4 lakh you usually win on old regime at 15 lakh CTC. Above 25 lakh CTC, the new regime usually wins unless you have a big home-loan interest.
Does the new regime have any deductions?
Yes but limited: a 75,000 standard deduction (from FY24-25), employer NPS contribution under 80CCD(2), and the rebate under Section 87A that makes income up to 12 lakh effectively tax-free. You lose 80C, 80D, HRA, LTA, and Section 24 home-loan interest.
Will old regime be abolished?
The government has indicated the old regime will eventually be phased out, though no explicit deadline has been set as of FY26-27. Plan 15-year locks like PPF assuming you may not get the deduction for the full duration.
How does salary growth change the regime choice?
As income rises, fixed deductions shrink in relative value. A 2-lakh home-loan interest saves 40,000 tax at 15 lakh but still only saves 40,000 tax at 50 lakh, while income shifts into higher slabs where the new regime