How much tax will be levied on your annual salary of Rs 15 lakh! Know the answer here

There are two main income tax systems in India, the new tax regime and the old tax regime. Each has its own tax slabs and rules for deductions. Let’s break down how much tax you’d owe under both systems if your annual income is Rs 15 lakh.

1. New Tax Regime – Exemption: If your total salary (including all income sources) is Rs 15,00,000, the standard deduction in this regime is Rs 75,000.

Here’s the new tax slab for FY 2025-26:

– Rs 0 – Rs 4,00,000: 0%
– Rs 4,00,001 – Rs 8,00,000: 5%
– Rs 8,00,001 – Rs 12,00,000: 10%
– Rs 12,00,001 – Rs 16,00,000: 15%
– Above Rs 16,00,000: 30%

Calculating Taxable Income:
Total Income = Rs 15,00,000
Standard Deduction = Rs 75,000

Taxable Income = 15,00,000 – 75,000 = Rs 14,25,000.

Tax Calculation (Step-by-Step):

0% tax on ₹0 to Rs 4,00,000 → Rs 0 Tax
Next ₹4,00,000 (5% on 4,00,001 to 8,00,000) = Rs 4,00,000 × 5% = Rs 20,000
Next ₹4,00,000 (10% on 8,00,001 to 12,00,000) = ₹4,00,000 × 10% = ₹40,000
Remaining ₹2,25,000 (15% on 12,00,001 to 14,25,000) = ₹2,25,000 × 15% = ₹33,750
Total Tax (before cess) = 20,000 + 40,000 + 33,750 = ₹93,750

Health and Education Cess (4%):
Cess = ₹93,750 × 4% = ₹3,750

Total Tax Payable:
Total = ₹93,750 + ₹3,750 = ₹97,500

2. Now, let’s look at the old tax regime.
Your total salary = ₹15,00,000

Total Deductions

Standard Deduction = 50,000 80C + 80D + 80CCD = 1,50,000 + 25,000 + 50,000 = 2,25,000 Total Deductions = 50,000 + 2,25,000 = ₹2,75,000 Taxable Income Total Income = ₹15,00,000 Total Deductions = ₹2,75,000 Taxable Income = 15,00,000 – 2,75,000 = ₹12,25,000 Tax Slab (Old Regime) ₹0 – ₹2,50,000: 0% ₹2,50,001 – ₹5,00,000: 5% ₹5,00,001 – ₹10,00,000: 20% Above ₹10,00,001: 30% Tax Calculation (Step-by-Step) 0% on ₹0 to ₹2,50,000 → ₹0 Tax on next ₹2,50,000 (5% on ₹2,50,001 to ₹5,00,000) = ₹2,50,000 × 5% = ₹12,500 Tax on next ₹5,00,000 (20% on ₹5,00,001 to ₹10,00,000) = ₹5,00,000 × 20% = ₹1,00,000 Remaining ₹2,25,000 (30% on ₹10,00,001 to ₹12,25,000) Tax = ₹2,25,000 × 30% = ₹67,500 Tax (before cess) = 12,500 + 1,00,000 + 67,500 = ₹1,80,000 Health and Education Cess (4%) Cess = ₹1,80,000 × 4% = ₹7,200 Total tax to be paid Total = 1,80,000 + 7,200 = ₹1,87,200 Now let’s compare (Which Regime is Better?) New tax regime: Total tax = ₹97,500