Old vs New Tax Regime: The Exact Break-Even
Every guide says the answer “depends on your deductions” and then stops. This page gives the number: for each income, the exact deductions at which the old regime stops costing you more.
Quick answer
Find your salary in the table below and read the break-even column. If your actual old-regime deductions — 80C, 80D, NPS, home-loan interest and HRA exemption added together — come to more than that number, the old regime saves you money. If they come to less, the new regime wins. For most salaried people without a large HRA claim, the new regime wins at almost every income level.
The break-even grid
The break-even column is deductions over and abovethe old regime’s own ₹50,000 standard deduction. The last column marks whether that figure is reachable within the usual statutory limits, which come to about ₹4,75,000 before any HRA exemption.
| Gross salary | New regime tax | Break-even deductions | Realistically reachable? |
|---|---|---|---|
| ₹6,00,000 | ₹0 | ₹50,000 | Yes |
| ₹7,00,000 | ₹0 | ₹1,50,000 | Yes |
| ₹8,00,000 | ₹0 | ₹2,50,000 | Yes |
| ₹9,00,000 | ₹0 | ₹3,50,000 | Yes |
| ₹10,00,000 | ₹0 | ₹4,50,000 | Yes |
| ₹11,00,000 | ₹0 | ₹5,50,000 | Needs large HRA |
| ₹12,00,000 | ₹0 | ₹6,50,000 | Needs large HRA |
| ₹13,00,000 | ₹66,300 | ₹4,94,000 | Needs large HRA |
| ₹14,00,000 | ₹81,900 | ₹5,19,000 | Needs large HRA |
| ₹15,00,000 | ₹97,500 | ₹5,44,000 | Needs large HRA |
| ₹16,00,000 | ₹1,13,100 | ₹5,69,000 | Needs large HRA |
| ₹18,00,000 | ₹1,50,800 | ₹6,42,000 | Needs large HRA |
| ₹20,00,000 | ₹1,92,400 | ₹7,08,500 | Needs large HRA |
| ₹25,00,000 | ₹3,19,800 | ₹8,00,000 | Needs large HRA |
| ₹30,00,000 | ₹4,75,800 | ₹8,00,000 | Needs large HRA |
| ₹40,00,000 | ₹7,87,800 | ₹8,00,000 | Needs large HRA |
| ₹50,00,000 | ₹10,99,800 | ₹8,00,000 | Needs large HRA |
Two things the grid shows that nobody mentions
The hardest income to justify the old regime is ₹12.75 lakh, not the highest one. Read down the break-even column and it climbs steadily to ₹6,50,000 at a ₹12 lakh salary, then drops to about ₹4,94,000 at ₹13 lakh before climbing again. That is not an error. Up to roughly ₹12.75 lakh of salary, the ₹75,000 standard deduction pulls taxable income inside the ₹12,00,000 Section 87A rebate and the new regime charges you nothing at all. To beat zero, the old regime has to reach zero too, which means deductions large enough to pull taxable income under ₹5,00,000. Once your salary crosses the rebate ceiling and the new regime starts charging real tax, the old regime only has to match that real number — so the bar drops.
Above roughly ₹24 lakh, the break-even stops moving entirely. It settles at a flat ₹8,00,000 and stays there whether you earn ₹25 lakh, ₹40 lakh or ₹50 lakh. The reason is simple once you see it: at those incomes both regimes are taxing your marginal rupee at 30%, so every additional rupee of salary adds the same tax under both systems and cancels out of the comparison. What is left is a constant gap, and a constant gap needs a constant deduction to close. The practical version: if you are a high earner wondering whether the old regime is worth the paperwork, the question is not how much you earn — it is simply whether you can claim ₹8,00,000.
Methodology and assumptions
Every figure here is computed, not estimated. For each salary the new-regime tax is calculated using the FY 2026-27 slabs with the ₹75,000 standard deduction, the Section 87A rebate that zeroes tax up to ₹12,00,000 of taxable income, and the 4% health and education cess. The old-regime tax uses the pre-2020 slabs for taxpayers below 60, its ₹50,000 standard deduction, its own Section 87A rebate up to ₹5,00,000 of taxable income, and the same 4% cess.
The break-even is then found by solving for the deduction amount at which the two tax figures are equal, resolved to the nearest ₹500. The same tax functions power our income tax calculator and our per-salary tax pages, so the numbers on this page cannot disagree with the rest of the site.
The “realistically reachable” column compares the break-even against ₹4,75,000, which is Section 80C at ₹1,50,000, NPS under 80CCD(1B) at ₹50,000, health insurance under 80D at up to ₹75,000 for self and senior parents, and home-loan interest at ₹2,00,000 — all at their combined statutory limits, and before any HRA exemption. HRA is the one component that can push a salaried person well past that ceiling, which is why the column says “needs large HRA” rather than “impossible”. Our HRA calculator will tell you how much of your rent allowance is actually exempt.
Assumptions this grid does not make: it does not model taxpayers aged 60 or above, whose old-regime slabs differ; it does not include surcharge, which applies above ₹50 lakh of income and would change the picture at the top end; and it treats gross salary as fully taxable income with no exempt allowances beyond those described. Treat it as a decision aid for a typical salaried person under 60, not as a computation of your return.
Use this data
This grid is free to quote, republish or build on, with or without attribution. If you are a journalist, blogger or educator who needs a different income range or a variant of the assumptions, the methodology above is complete enough to reproduce — or write to us at hello@coinmind.in and we will run it.
Frequently asked questions
What is the break-even deduction between the old and new tax regime?+
It is the total of old-regime deductions — 80C, 80D, NPS, home-loan interest, HRA exemption and the rest — at which your old-regime tax falls to exactly what you would pay under the new regime. Claim more than that figure and the old regime saves you money; claim less and the new regime wins.
At what salary is the old regime hardest to justify?+
Around ₹12.75 lakh. At that level the new regime charges zero tax, because the ₹75,000 standard deduction brings taxable income within the ₹12,00,000 Section 87A rebate. To match zero under the old regime you would need roughly ₹6.5 lakh of deductions, which is beyond what most salaried people can claim without a very large HRA exemption.
Does the break-even keep rising with income?+
No, and this surprises people. Once your income is high enough that both regimes are taxing you at 30% at the margin — from roughly ₹24 lakh upward — the break-even settles at a flat ₹8,00,000 and stays there. Whether you earn ₹25 lakh or ₹50 lakh, the answer is the same ₹8 lakh of deductions.
Is ₹8 lakh of deductions actually achievable?+
Only with substantial rent. Section 80C (₹1.5 lakh), NPS under 80CCD(1B) (₹50,000), health insurance under 80D (up to ₹75,000) and home-loan interest (₹2 lakh) come to about ₹4.75 lakh at their combined limits. Getting past that needs a large HRA exemption, which in practice means high rent in a metro. For most people outside that situation, the new regime wins at higher incomes.
Do these figures include the standard deduction?+
Yes, and each regime gets its own. The new-regime column already applies its ₹75,000 standard deduction, and the old-regime side already applies its ₹50,000 one. The break-even number is deductions over and above that ₹50,000 — so do not count the standard deduction twice when comparing against your own figure.
Can I switch regimes every year?+
Salaried taxpayers without business income can generally choose afresh each year when filing. Taxpayers with business or professional income face a much more restrictive rule and can typically only switch back once. Because the mechanics depend on your income type and on filing by the due date, confirm your own position on the income tax portal before relying on being able to switch.