Income Tax Slabs & Statutory Rebates
Comprehensive personal taxation rate directory under the Income-tax Act, 2025 (Section 202(1)) and comparative 1961 Act provisions. Features symmetrical ₹4-Lakh slabs, Section 156(2) ₹12L rebate (max ₹60,000), marginal relief up to ₹12.75L, and Old vs New regime schedules.
Section 202(1) Default New Tax Regime (4-Lakh Interval Slabs)
Under the Income-tax Act, 2025, individual and HUF tax brackets have been expanded to symmetrical ₹4,00,000 intervals. Coupled with the enhanced Section 156(2) statutory rebate of ₹60,000 and Section 19(1) standard deduction of ₹75,000, taxpayers with salary income up to ₹12,75,000 pay zero income tax.
Zero Tax Up To ₹12.75 Lakh
Gross salary ₹12,75,000 less ₹75,000 standard deduction under Section 19(1) leaves taxable income of ₹12,00,000, fully sheltered by Section 156(2) rebate.
₹60,000 Full Tax Rebate
Enhanced statutory tax rebate covers 100% of tax liability for resident individuals having taxable income not exceeding ₹12,00,000.
Symmetrical 4-Lakh Brackets
Rates step up progressively at 5%, 10%, 15%, 20%, 25% for every ₹4 Lakh interval, peaking at 30% above ₹24,00,000.
Statutory Slabs under Section 202(1) — Act 2025
Applicable to Individuals, HUF, AOP, and BOI from Tax Year 2026-27 onwards
Resident individuals with total taxable income up to ₹12,00,000 receive a rebate of 100% of income-tax payable or ₹60,000, whichever is less under Section 156(2).
Where total taxable income slightly exceeds ₹12,00,000, the income-tax payable shall not exceed the amount by which total income exceeds ₹12,00,000.
Surcharge Rates & 4% Health and Education Cess
High Net-Worth Individual (HNI) surcharge caps under the New Tax Regime
| Taxable Income Bracket | New Regime Surcharge Rate | Old Regime Surcharge Rate | Health & Education Cess | Effective Surcharge Cap Note |
|---|---|---|---|---|
| Up to ₹50,00,000 | NIL | NIL | 4% | Standard base tax rate |
| ₹50,00,001 to ₹1,00,00,000 | 10% | 10% | 4% | Marginal relief applies on threshold breach |
| ₹1,00,00,001 to ₹2,00,00,000 | 15% | 15% | 4% | Marginal relief applies on ₹1Cr boundary |
| Above ₹2,00,00,000 | 25% (Capped) | 25% / 37% | 4% | 37% Surcharge abolished in New Regime (Max 39% eff. rate vs 42.74%) |
Statutory Evolution: Prior Law (Act 1961) vs. Current Law (Act 2025)
Structural shift from ₹3-Lakh intervals to ₹4-Lakh intervals and rebate expansion
Section 115BAC (3-Lakh Intervals)
Section 202(1) (4-Lakh Intervals)
Statutory Salary Deductions & Retirement Exemptions (Section 19(1))
Key allowances and retirement relief available under the Income-tax Act, 2025
Standard Deduction
₹75,000 or the amount of salary, whichever is less.
Gratuity Exemption
Gratuity exemption up to ₹20,00,000 for private sector employees covered/not covered under the Payment of Gratuity Act, 1972.
Leave Encashment Exemption
Exemption for encashment of earned leave up to ₹25,00,000 for non-government employees upon retirement or superannuation.
Commuted Pension Relief
1/3rd of pension if gratuity received; 1/2 of pension if no gratuity received.
VRS / Retrenchment Relief
Compensation received upon voluntary retirement or retrenchment exempt up to ₹5,00,000.
Simulate Your Salary & Taxes
Use our dual-act interactive calculator for complete breakdown across both regimes.
Quick Dual-Act Slab Comparison Widget
Input your gross total income to compare tax liability between Act 2025 and Act 1961
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