Old vs New Tax Regime: Choosing Right for FY 2026-27

The new tax regime is now the default, and for a large majority of salaried taxpayers it produces a lower liability. But "majority" is not "everyone" — and the difference can be material.

When the old regime still wins

• Substantial housing loan interest on a let-out or self-occupied property
• HRA claims in high-rent metros combined with 80C and 80D limits fully used
• Significant donations eligible under Section 80G

A simple decision framework

1. Compute total deductions you would actually claim under the old regime.
2. Compare against the break-even deduction level for your income slab.
3. Remember that business taxpayers can switch regimes only once — salaried taxpayers can choose every year.

The right answer is a computation, not a rule of thumb. Run both numbers before the July deadline.

The firm runs both computations for every ITR engagement as standard practice.