Budget 2025: With taxpayers eyeing big relief in Nirmala Sitharaman's speech, here's your complete guide to new vs old tax regime
Budget 2025: With Finance Minister Nirmala Sitharaman set to announce budget on Saturday, February 1, 2025, crores of taxpayers are expecting significant relief in income tax slabs. But as things stand, where will pay higher tax- old tax regime or new tax regime.
Budget 2025: Taxpayers expect huge relief in income tax slabs. The reason is it increases their consumption power and helps them fight inflation. Budget 2025 will be no exception. Since the income of central government employees may increase due to the 8th Pay Commission, private sector employees and a lot of others are expecting Finance Minister Nirmala Sitharaman to announce huge income tax benefits during her Budget 2025 speech on February 1, Saturday. Leading research firm SBI Research is expecting the government to reduce tax from 20 per cent to 15 per cent for individuals earning between Rs 10 lakh and Rs 15 lakh annually. For a taxpayer keenly following budget proceedings, such expectations are common. However, as things stand now, let us take you through various tax slabs in the old and new tax regimes and where you have to pay a higher tax. Get answers to these questions in this article.
Photos: Unsplash/Pixabay/Pexels
Calculation Courtesy: BankBazaar.com
Tax slabs in old tax regime

Tax slabs in old tax regime

New tax regime

Tax slabs in new tax regime

Standard deduction limit

New vs Old tax regime: Key differences

The old tax regime provides more deductions to taxpayers. But they need to invest money in schemes with long lock-in investment schemes to avail those benefits or need to pay premiums of insurance policies, among other tax saving tactics. Such benefits are not available to taxpayers following the new tax regime. Old regime taxpayers have over 70 exemptions and deductions. The most important of them is Section 80C of the Income Tax Act, where one can save up to Rs 1.50 lakh in a financial year.
New tax regime rebate

Where do you pay higher tax?

Old vs New Tax Regime: On Rs 7 lakh income

Old vs New Tax Regime: On Rs 9 lakh income

Old vs New Tax Regime: On Rs 13 lakh income

Old vs New Tax Regime: On Rs 15 lakh income

Old vs New Tax Regime: On Rs 16 lakh income

Old vs New Tax Regime: On Rs 25 lakh income

Old vs New Tax Regime: On Rs 50 lakh income

Old vs New Tax Regime: On Rs 75 lakh income

Old vs New Tax Regime: On Rs 1 crore income

Tax chart

Deduction Needed For Equal Tax Under OR & NR | ||||
Income | Deduction (Before SD) | Deduction Rate (Before SD) | OR Tax | NR Tax (FY24-25) |
1,00,000 | - | - | - | - |
2,00,000 | - | - | - | - |
3,00,000 | - | -- | - | - |
4,00,000 | - | -- | - | - |
5,00,000 | - | - | - | - |
6,00,000 | 50,000 | 8.33% | - | - |
7,00,000 | 1,50,000 | 21.43% | - | - |
8,00,000 | 2,00,000 | 25.00% | 23,400 | 23,400 |
9,00,000 | 2,50,000 | 27.78% | 33,800 | 33,800 |
10,00,000 | 3,00,000 | 30.00% | 44,200 | 44,200 |
11,00,000 | 3,43,750 | 31.25% | 55,900 | 55,900 |
12,00,000 | 3,68,750 | 30.73% | 71,500 | 71,500 |
13,00,000 | 3,87,500 | 29.81% | 88,400 | 88,400 |
14,00,000 | 3,87,500 | 27.68% | 1,09,200 | 1,09,200 |
15,00,000 | 4,08,333 | 27.22% | 1,30,000 | 1,30,000 |
16,00,000 | 4,33,333 | 30.21% | 1,53,400 | 1,53,400 |
17,00,000 | 4,33,333 | 28.43% | 1,84,600 | 1,84,600 |
18,00,000 | 4,33,333 | 26.85% | 2,15,800 | 2,15,800 |
19,00,000 | 4,33,333 | 25.44% | 2,47,000 | 2,47,000 |
20,00,000 | 4,33,333 | 24.17% | 2,96,400 | 2,96,400 |
21,00,000 | 4,33,333 | 23.02% | 3,09,400 | 3,09,400 |
22,00,000 | 4,33,333 | 21.97% | 3,40,600 | 3,40,600 |
23,00,000 | 4,33,333 | 21.01% | 3,71,800 | 3,71,800 |
24,00,000 | 4,33,333 | 20.14% | 4,03,000 | 4,03,000 |
25,00,000 | 4,33,333 | 19.33% | 4,52,400 | 4,52,400 |
30,00,000 | 4,33,333 | 14.44% | 5,90,200 | 5,90,200 |
35,00,000 | 4,33,333 | 12.38% | 7,46,200 | 7,46,200 |
40,00,000 | 4,33,333 | 10.83% | 9,02,200 | 9,02,200 |
45,00,000 | 4,33,333 | 9.63% | 10,58,200 | 10,58,200 |
50,00,000 | 4,33,333 | 8.67% | 12,14,400 | 12,14,400 |
55,00,000 | 3,13,250 | 5.70% | 15,07,220 | 15,07,220 |
60,00,000 | 4,33,333 | 7.22% | 16,78,820 | 16,78,820 |
65,00,000 | 4,33,333 | 6.67% | 18,50,420 | 18,50,420 |
70,00,000 | 4,33,333 | 6.19% | 20,22,020 | 20,22,020 |
75,00,000 | 4,33,333 | 5.78% | 21,93,620 | 21,93,620 |
80,00,000 | 4,33,333 | 5.42% | 23,65,220 | 23,65,220 |
85,00,000 | 4,33,333 | 5.10% | 25,36,820 | 25,36,820 |
90,00,000 | 4,33,333 | 4.81% | 27,08,420 | 27,08,420 |
95,00,000 | 4,33,333 | 4.56% | 28,80,020 | 28,80,020 |
1,00,00,000 | 4,33,333 | 4.33% | 30,51,260 | 30,51,260 |
Standard deduction of 50,000 not included in above deduction. Compiled on BankBazaar Income Tax Calculator. https://bit.ly/4cTYEQB |