Income Tax on ₹7 Lakh Salary — FY 2026-27 (Old vs New Regime)
At ₹7 Lakh with no deductions, the new regime saves ₹44,200 per year. The old regime only wins if your deductions exceed ₹1,50,100.
| Item | New Regime | Old Regime |
|---|---|---|
| Gross Income | ₹7,00,000 | ₹7,00,000 |
| Standard Deduction | ₹75,000 | ₹50,000 |
| Taxable Income | ₹6,25,000 | ₹6,50,000 |
| Cess (4%) | ₹0 | ₹1,700 |
| Total Tax | ₹0 | ₹44,200 |
| Effective Tax Rate | 0.00% | 6.31% |
| Monthly Take-Home | ₹58,333 | ₹54,650 |
New Regime — Slab-wise Tax
| Slab | Rate | Tax |
|---|---|---|
| ₹0 to ₹400,000 | 0% | ₹0 |
| ₹400,000 to ₹800,000 | 5% | ₹11,250 |
Old Regime — Slab-wise Tax
| Slab | Rate | Tax |
|---|---|---|
| ₹0 to ₹250,000 | 0% | ₹0 |
| ₹250,000 to ₹500,000 | 5% | ₹12,500 |
| ₹500,000 to ₹1,000,000 | 20% | ₹30,000 |
Break-Even Deduction
You'd need to claim at least ₹1,50,100 in total deductions (80C, 80D, home loan interest, HRA, NPS combined) under the old regime before it matches the new regime's ₹0 tax bill.
At ₹7 Lakh, the Section 87A rebate is doing most of the work. Under the new regime for FY 2026-27, taxable income up to ₹12 lakh gets a rebate of up to ₹60,000 — which is enough to zero out the tax bill entirely for most salaried employees at this income level once the ₹75,000 standard deduction is applied.
The old regime has a much lower rebate ceiling (taxable income up to ₹5 lakh, rebate capped at ₹12,500), so it only comes out ahead here if you're claiming enough deductions — HRA, 80C, home loan interest — to pull your taxable income back under that threshold. For most people at ₹7 Lakh without heavy deduction claims, the new regime wins by a wide margin.
If you do have provident fund contributions, life insurance premiums, or a home loan already in place, it's still worth running the old regime numbers below — the break-even figure shows exactly how much you'd need to claim.
Run Your Exact Numbers
This scenario assumes only salary income and no deductions. Use the full calculator to add your actual deductions, other income, and see the precise comparison.
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These figures are estimates for informational purposes only and are not tax or financial advice. Verify your actual liability with the Income Tax Department or a qualified tax professional before filing.