Deductions Comparison Between Old vs New Regime

Thu Mar 20, 2025

Comparison of Deductions & Exemptions: Old vs. New Tax Regime (FY 2025-26)

Deductions & Exemptions	Old Tax Regime	New Tax Regime
Standard Deduction	₹50,000	₹75,000
Section 80C (PPF, EPF, LIC, ELSS, etc.)	Up to ₹1,50,000	Not Available
Section 80D (Health Insurance Premiums)	Up to ₹25,000 (₹50,000 for senior citizens)	Not Available
House Rent Allowance (HRA)	Available	Not Available
Interest on Home Loan (Self-Occupied Property)	Up to ₹2,00,000	Not Available
Section 80TTA (Savings Account Interest)	Up to ₹10,000	Not Available
Section 80G (Donations to Charitable Institutions)	Available	Not Available
Employer’s Contribution to NPS (80CCD(2))	Up to 10% of salary	Up to 10% of salary
Rebate under Section 87A	Available for income up to ₹5 lakh	Available for income up to ₹12 lakh

Old Tax Regime: Best for individuals who can claim multiple deductions and exemptions.
New Tax Regime: Lower tax rates but fewer deductions, suitable for those who do not invest heavily in tax-saving instruments.
Rebate under Section 87A: Higher exemption limit in the new regime makes it beneficial for middle-income earners.
Standard Deduction: Increased to ₹75,000 in the new regime, providing some relief.
Employer’s NPS Contribution: Available in both regimes.