Calculate Your In-Hand Salary Under the New Tax Regime
The new tax regime simplifies tax calculation by removing most exemptions and applying lower slab rates. Here's what our calculator covers to give you an accurate in-hand figure.
💰 Annual Take-Home
Your net annual salary after PF, professional tax, income tax, and cess — the money you actually keep across the year.
📅 Monthly In-Hand
Annual take-home divided by 12. This is the exact amount credited to your bank account every month.
📊 Tax Breakdown
Slab-by-slab income tax, health & education cess (4%), Section 87A rebate — all calculated precisely for FY 2025-26.
🔢 Effective Tax Rate
Your actual tax as a % of gross income — often much lower than the marginal slab rate due to standard deduction and 87A rebate.
Salary Breakdown Under the New Tax Regime
Every component of your payslip, and how it flows from CTC to your monthly in-hand amount under the new regime.
| Component | In New Regime | Impact on Take-Home |
|---|---|---|
| Basic Salary (40–50% of CTC) | Taxable | Base for PF, HRA, gratuity |
| HRA (House Rent Allowance) | Fully Taxable | No exemption in new regime |
| Special / Other Allowance | Fully Taxable | Added to gross, taxed fully |
| Standard Deduction | ₹75,000 allowed | Reduces taxable income |
| Employee PF (12% of basic) | Deducted | Goes to EPF, not in-hand |
| Employer PF & Gratuity | Not In-Hand | Part of CTC only |
| Professional Tax | Deducted | State levy, max ₹2,500/yr |
| Income Tax (TDS) | New Slab Rates | As per FY 2025-26 slabs |
| Health & Education Cess | 4% on tax | Applied on income tax amount |
New Tax Regime Slabs for FY 2025-26
The revised new tax regime slabs effective from FY 2025-26 (Budget 2025). These are the rates applied in our calculator. Zero tax applies on income up to ₹12 lakh under Section 87A rebate.
| Income Slab (Annual) | Tax Rate | Max Tax in Slab | Notes |
|---|---|---|---|
| ₹0 – ₹4,00,000 | 0% | ₹0 | Fully exempt |
| ₹4,00,001 – ₹8,00,000 | 5% | ₹20,000 | On ₹4L |
| ₹8,00,001 – ₹12,00,000 | 10% | ₹40,000 | On ₹4L |
| ₹12,00,001 – ₹16,00,000 | 15% | ₹60,000 | On ₹4L |
| ₹16,00,001 – ₹20,00,000 | 20% | ₹80,000 | On ₹4L |
| ₹20,00,001 – ₹24,00,000 | 25% | ₹1,00,000 | On ₹4L |
| Above ₹24,00,000 | 30% | Unlimited | Plus 4% cess |
Key Change: Budget 2025
The nil slab was raised from ₹3L to ₹4L. Section 87A rebate raised from ₹7L to ₹12L. Standard deduction raised from ₹50,000 to ₹75,000. All effective FY 2025-26.
How This New Regime Salary Calculator Works
Our calculator follows the exact sequence used in payroll processing. Here's every step it takes from your CTC to your final in-hand number.
Derive Gross Salary from CTC
CTC minus employer-side costs (employer PF + gratuity provision) gives your gross annual salary — what appears on your payslip before any deductions.
Calculate Taxable Income
Taxable Income = Gross Salary − Standard Deduction (₹75,000). No other exemptions (HRA, 80C, 80D) are allowed under the new regime.
Apply New Regime Tax Slabs
Tax is computed slab by slab on taxable income. Each slab rate applies only to the income that falls within that bracket — not the full income.
Apply Section 87A Rebate
If taxable income ≤ ₹12,00,000, the full tax liability is waived under Section 87A rebate — making the effective tax ₹0. The 4% cess is added after this check.
Subtract All Deductions → In-Hand
Final In-Hand = Gross Salary − Employee PF − Professional Tax − Income Tax (with cess) − Other Deductions. Divide by 12 for monthly salary.
What Is Taxable Salary in the New Tax Regime
Under the new regime, nearly your entire gross salary is taxable. Unlike the old regime, you cannot claim most exemptions. Here's exactly what is and isn't included.
✅ Included in Taxable Income
Basic salary, HRA (no exemption), special allowance, performance bonus, LTA (no exemption), all other allowances — everything in your gross salary.
⬇️ Deducted from Taxable Income
Only ₹75,000 standard deduction is allowed. No 80C, no 80D, no HRA exemption, no home loan interest — the new regime is deliberately minimal.
❌ NOT Allowed in New Regime
Section 80C investments, health insurance (80D), HRA exemption, home loan interest (Sec 24b), LTA, NPS deduction (employee share) — all disallowed.
🧾 Final Taxable Income Formula
Taxable Income = Gross Salary − ₹75,000 (standard deduction). This is the single deduction available and it applies to all salaried employees automatically.
Standard Deduction in the New Tax Regime
The standard deduction is a flat ₹75,000 reduction from your gross salary before tax is calculated. No bills, no proofs — it's applied automatically to all salaried individuals.
₹75,000 Standard Deduction — Key Facts
Raised from ₹50,000 to ₹75,000 in Budget 2025 (effective FY 2025-26). Available in both new and old regime. Applied on gross salary, not CTC. For a ₹12L salary employee in the 10% slab, this saves ₹7,500 in tax annually.
| Annual CTC | Without Std Deduction | With ₹75K Std Deduction |
|---|---|---|
| ₹8,00,000 | Taxable: ₹8L (approx) | Taxable: ₹7.25L → Zero tax (87A) |
| ₹12,00,000 | Taxable: ₹12L → Tax ₹60K | Taxable: ₹11.25L → Zero tax (87A) |
| ₹15,00,000 | Taxable: ₹15L → Tax ₹1.5L | Taxable: ₹14.25L → Tax ₹1.39L |
| ₹20,00,000 | Taxable: ₹20L → Tax ₹3L | Taxable: ₹19.25L → Tax ₹2.84L |
Section 87A Rebate Under the New Tax Regime
Section 87A is the most powerful tax benefit in the new regime. It makes income up to ₹12 lakh (after standard deduction) completely tax-free for salaried employees.
- Taxable income ≤ ₹12,00,000
- Full tax liability waived — pay ₹0 tax
- Applies after standard deduction of ₹75,000
- Effective CTC limit: approx ₹13.7L (with PF)
- Resident Indian individuals only
- No action needed — applied automatically
- Taxable income above ₹12,00,000
- Full slab-wise tax applies — no rebate
- Even ₹1 over the limit removes entire rebate
- Non-residents (NRIs) are not eligible
- Special rate income (LTCG, STCG) taxed separately
- Tax must be paid as per applicable slab
The 87A Cliff Warning
If your taxable income is ₹12,00,001 — just ₹1 above the limit — the entire 87A rebate is lost and you pay tax on the full ₹12L+ amount. This creates a significant "cliff" effect. Structuring your CTC carefully near this limit is worth reviewing with a CA.
Monthly vs Annual Salary Calculation
Our calculator shows both monthly in-hand and annual take-home. Here's the difference between the two views and when each is most useful.
- Annual take-home divided by 12
- Matches your bank credit every month
- Use this for budgeting, rent, and EMIs
- Tax is distributed equally across 12 months
- Professional tax may vary slightly by state
- PF deduction is capped at ₹1,800/month
- Full-year net salary after all deductions
- Use this for financial planning & investments
- Compare against job offers more accurately
- Shows total PF and tax paid for the year
- Better for ITR filing reference
- Switch view using the Monthly/Yearly toggle above
FAQs on New Tax Regime Salary Calculator
Answers to the most common questions about the new tax regime, in-hand salary, and how our calculator works.