New vs old tax regime: how to decide

Every year, taxpayers must choose between the old regime (higher rates, but generous deductions) and the new regime (lower rates, minimal deductions). The right choice depends entirely on how much you claim in deductions.

The trade-off

The old regime rewards you for investments and expenses — home loan interest, insurance, provident fund, and more. The new regime ignores most of these but applies lower slab rates and a higher standard deduction.

A quick rule of thumb

If your total deductions are modest, the new regime usually wins. If you claim large deductions (a home loan plus full 80C plus health insurance), the old regime often comes out ahead. Run both with your actual numbers before filing.

Try our calculator

Use the income-tax calculator in our tools section to estimate your liability under the new regime in seconds.