The Government of India has continued with the revised New Tax Regime for the Financial Year 2025-26, which now includes a Standard Deduction of ₹75,000 for salaried individuals and pensioners. This updated structure simplifies tax calculations and offers lower rates across income brackets. Here’s a comprehensive overview of the regime, applicable tax slabs, and total tax payable for different income levels.
📌 Key Highlights:
- Standard Deduction: ₹75,000 across all income brackets.
- Tax-Free Income: Up to ₹7 lakh (post standard deduction) eligible for full tax rebate under Section 87A.
- Tax Slabs are progressive, with increasing rates at higher income levels.
- Health & Education Cess: 4% on income tax.
- Tax calculation is based on Taxable Income = Gross Income – ₹75,000 (Standard Deduction)
📊 Tax Slabs Under New Regime 2025-26:
| Taxable Income (₹) | Applicable Tax Rate |
|---|---|
| 0 – 3,00,000 | 0% |
| 3,00,001 – 6,00,000 | 5% |
| 6,00,001 – 9,00,000 | 10% |
| 9,00,001 – 12,00,000 | 15% |
| 12,00,001 – 15,00,000 | 20% |
| Above 15,00,000 | 30% |
🧮 Income vs Tax Payable Table (after ₹75,000 Standard Deduction)
| Gross Income (₹) | Taxable Income (₹) | Tax Slab | Tax (₹) | Cess (₹) | Total Tax (₹) | Remarks |
|---|---|---|---|---|---|---|
| 1,75,000 | 1,00,000 | 0% | 0 | 0 | 0 | Rebate – No Tax |
| 2,75,000 | 2,00,000 | 0% | 0 | 0 | 0 | Rebate – No Tax |
| 3,75,000 | 3,00,000 | 0% | 0 | 0 | 0 | Rebate – No Tax |
| 4,75,000 | 4,00,000 | 0% | 0 | 0 | 0 | Rebate – No Tax |
| 5,75,000 | 5,00,000 | 5% | 5,000 | 0 | 5,000 | Rebate – No Tax |
| 6,75,000 | 6,00,000 | 5% | 10,000 | 0 | 10,000 | Rebate – No Tax |
| 7,75,000 | 7,00,000 | 5% | 15,000 | 0 | 15,000 | Rebate Applicable – No Tax |
| 8,75,000 | 8,00,000 | ₹20,000 + 10% of amount above ₹8L | 20,000 | 0 | 20,000 | |
| 9,75,000 | 9,00,000 | ₹20,000 + 10% of ₹1L = ₹30,000 | 30,000 | 1,200 | 31,200 | |
| 10,75,000 | 11,00,000 | ₹20,000 + 10% of ₹3L = ₹50,000 | 50,000 | 2,000 | 52,000 | |
| 13,75,000 | 13,00,000 | ₹60,000 + 15% of ₹1L = ₹75,000 | 75,000 | 3,000 | 78,000 | |
| 16,75,000 | 16,00,000 | ₹60,000 + 15% of ₹4L = ₹1,20,000 | 1,20,000 | 4,800 | 1,24,800 | |
| 20,75,000 | 20,00,000 | ₹1,20,000 + 20% of ₹4L = ₹2,00,000 | 2,00,000 | 8,000 | 2,08,000 | |
| 24,75,000 | 24,00,000 | ₹1,20,000 + 25% of ₹4L = ₹3,20,000 | 3,20,000 | 12,800 | 3,32,800 | |
| 30,75,000 | 30,00,000 | ₹1,30,000 + 30% of ₹6L = ₹3,10,000 | 4,90,000 | 19,600 | 5,09,600 | |
| 41,75,000 | 41,00,000 | ₹1,30,000 + 30% of ₹17L = ₹6,40,000 | 8,10,000 | 32,400 | 8,42,400 | Highest slab |
Note: Only a few rows are shown above for brevity. The original chart contains values from ₹1.75L to ₹41.75L.
✅ Rebate under Section 87A
If your taxable income (after standard deduction) does not exceed ₹7,00,000, you are eligible for a rebate up to ₹25,000, which results in zero tax liability.
🔍 Who Should Opt for New Regime?
You should consider the New Regime if:
- You do not have significant exemptions (like HRA, LTA, 80C, 80D etc.).
- You prefer a simpler tax structure.
- Your income is up to ₹7 lakh – you benefit from the full rebate.
🖋️ Prepared By:
Sreedhar Sharma Adluri, Warangal
(As seen in the image chart)
📢 Conclusion
The New Tax Regime 2025-26 with ₹75,000 standard deduction and ₹7 lakh rebate threshold offers a clean, compliance-friendly option for many taxpayers. It’s especially beneficial for salaried individuals without major deductions or exemptions. Use the table above to compute your liability easily and compare it with the old regime (if applicable) to make an informed decision.