Income Tax
New Tax Regime — Meaning
The default regime with lower slab rates, a ₹75,000 standard deduction and nil tax up to ₹12 lakh, but few deductions.
What is New Tax Regime?
The new tax regime is the default for individuals. For FY 2025-26 and FY 2026-27 its slabs run from nil up to ₹4 lakh to 30% above ₹24 lakh, salaried taxpayers get a ₹75,000 standard deduction, and the Section 87A rebate makes taxable income up to ₹12 lakh tax-free for residents. Most deductions — 80C, 80D, HRA, home-loan interest on a self-occupied house — aren't allowed, but the employer's NPS contribution (up to 14% of salary) is. Salaried taxpayers can choose between regimes every year.
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More Income Tax terms
ITR (Income Tax Return)
Annual declaration filed with India's Income Tax Department reporting income, deductions and tax paid.
AY (Assessment Year)
The year in which income earned in the previous financial year is assessed and taxed.
FY (Financial Year)
The 12-month period from April 1 to March 31 during which income is earned and recorded.
PAN (Permanent Account Number)
Unique 10-character alphanumeric identifier issued by the Income Tax Department to every taxpayer.
TAN (Tax Deduction Account Number)
10-character number required by entities that deduct or collect tax at source (TDS/TCS).
