Tax Formula • Published on July 30, 2026 • Last updated July 30, 2026
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Total income from Salary, House Property, Capital Gains, and Other Sources
Deductible savings and expenditures (e.g., Sec 80C, 80D, HRA for Old regime, Standard Deduction)
Progressive tax computed by applying tax bracket rates to taxable income
Section 87A rebate for taxable income below specified limits
Health and Education Cess of 4% applied to the calculated tax liability
Income tax is computed progressively based on income tax slabs. Taxpayers can choose between the Old Regime (which allows major deductions but has higher tax rates) and the New Regime (which has lower rates but restricts most deductions).
Section 87A rebate provides tax relief to individuals whose taxable income does not exceed a specified threshold, making their effective tax liability zero.
Marginal Relief provides relief when taxable income slightly exceeds the rebate threshold, ensuring that the increase in tax is not higher than the increase in income.
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