Old vs New Tax Simulator India: Compare Regimes 2026

Old vs New Tax Simulator India: This free INDwallet tool compares your income tax liability under the old and new tax regimes. Enter your annual salary, select applicable deductions (80C, 80D, HRA, etc.), and instantly see which regime results in lower tax. The simulator factors in standard deduction, rebate under 87A, and surcharge, giving you a clear, personalized comparison to make the optimal choice each financial year.

AI Summary: Old vs New Tax Simulator India

• Old regime allows deductions like 80C (₹1.5L), 80D, HRA, home loan interest, but has higher tax slabs.
• New regime offers lower tax rates but disallows most deductions (only standard deduction of ₹75,000).
• If your total deductions exceed ₹3.5-4L, old regime generally saves more tax.
• Use the simulator every April to choose the optimal regime for the upcoming financial year.
• Try it free at Old vs New Tax Simulator—no signup, private, instant.

1. What is Old vs New Tax Simulator India?

Old vs New Tax Simulator India is a free, interactive tool from INDwallet that helps salaried individuals and freelancers compare their income tax liability under the old and new tax regimes. The simulator asks for your annual income, age, and various deductions like Section 80C, 80D, HRA, home loan interest, and NPS. It then calculates tax under both regimes, factoring in standard deduction, rebate under Section 87A, and applicable surcharge. The output clearly shows which regime results in lower tax and the exact savings. This tool is essential for making an informed choice every financial year, as the optimal regime varies based on individual deduction levels.

Read our Section 80C Deductions India 2026 guide to maximize tax savings under old regime.

2. Why Use the Old vs New Tax Simulator?

Choosing the wrong tax regime can cost you thousands in unnecessary tax. The new regime is the default, but many taxpayers with significant deductions (home loan, 80C, NPS, HRA) may benefit from the old regime. The simulator provides a personalized, data-driven answer in seconds. It eliminates guesswork and helps you plan your investments for maximum tax efficiency. For example, if you’re on the fence about making an 80C investment, the simulator can show you the tax impact under both regimes, helping you decide whether the investment is worth it from a tax perspective. Run the simulation before the start of each financial year to optimize your tax outgo.

• Personalized comparison: Based on your exact salary and deductions.
• What-if analysis: See how additional deductions change the outcome.
• Yearly planning: Use it every April to choose the best regime.

3. Mistakes to Avoid with Old vs New Tax Simulator

4. Step-by-Step: How to Use Old vs New Tax Simulator

1. Enter annual income: Gross salary or freelance income.
2. Select age: Affects basic exemption limit for senior citizens.
3. Enter deductions (Old Regime): 80C, 80D, HRA, home loan interest, NPS (80CCD(1B)), etc.
4. Enter deductions (New Regime): Employer NPS contribution (if any).
5. View comparison: See tax liability under both regimes side-by-side.
6. Adjust inputs: Test “what-if” scenarios to optimize.

Try it now: Old vs New Tax Simulator.

5. Real India Example: Salary ₹8L, ₹12L, ₹20L

Assume standard deduction ₹75,000 (new) / ₹50,000 (old), and 80C ₹1.5L for old regime where applicable.

For ₹8L salary with minimal deductions, new regime wins. For ₹12L+ with full 80C and NPS, old regime often saves more. Always simulate with your exact numbers.

6. Simulator Output: Impact of Additional 80C/NPS

₹15L salary, old regime with varying deduction levels.

This shows the breakeven point: around ₹1.2-1.5L of deductions, old regime becomes beneficial. The simulator helps you find your exact tipping point.

7. What Most People Miss: Rebate under Section 87A

Under the new regime, if your taxable income is up to ₹7,00,000, you get a full rebate of tax (up to ₹25,000), making your tax liability zero. Under the old regime, the rebate is available only up to ₹5,00,000 taxable income. This makes the new regime extremely attractive for incomes up to ₹7.5-8L. For example, a person earning ₹7.5L with no deductions pays zero tax in new regime but ~₹65,000 in old regime. The simulator automatically applies this rebate, so you don’t have to calculate it manually. This is a key reason why many lower-income earners benefit from the new regime.

8. From Simulation to Decision: The Complete Flow

9. Decision Framework: Old or New Regime?

• If your total deductions (80C, 80D, HRA, home loan interest, NPS) exceed ₹3.5L: Old regime likely saves more.
• If your income is below ₹7.5L and you have minimal deductions: New regime with 87A rebate is best.
• If you are a freelancer/business owner: New regime offers simplicity, but old regime allows business expenses.
• If you want flexibility to switch annually: Salaried can choose every year; business owners cannot switch frequently.

10. Explore More INDwallet Tax Planning Tools

• Old vs New Tax Simulator – Compare regimes.
• Income Wallet – Track salary and tax.
• Section 80C Deductions India 2026 – Complete list.
• PPF vs ELSS vs NPS India – Best 80C options.
• Home Loan Tax Benefit India – Section 24, 80EEA.
• Freelancer Tax Guide India 2026 – 44ADA explained.