FinTaxLife/FinDashFinTaxFinSightTools
FinTaxLife TOOLS

Tools / Blog / Income Tax

Income Tax Act 2025: Tax Year 2026-27 Explained

Updated 4 October 2026 · Income Tax

TAX UPDATEIncome Tax Act 2025Tax Year 2026-27: what actually changedFinTaxLife ToolsIncome Tax Act 2025Current rulesPractical checklistUpdated 4 Oct 2026
On this page
  1. The terminology changed
  2. Current new-regime slabs
  3. The ₹12 lakh rebate
  4. Do not mix years

The terminology changed

The Income-tax Act, 2025 applies from 1 April 2026 and the new framework uses “Tax Year”. Tax Year 2026-27 covers income earned from 1 April 2026 to 31 March 2027.

Current new-regime slabs

For Tax Year 2026-27, section 202 keeps the 0%, 5%, 10%, 15%, 20%, 25% and 30% slab structure, with the top slab above ₹24 lakh.

The ₹12 lakh rebate

Eligible resident individuals can receive a section 87A rebate of up to ₹60,000 within the ₹12 lakh taxable-income condition. The ₹75,000 standard deduction for eligible salary income also affects the effective gross-salary point.

Do not mix years

Income earned in FY 2025-26 is associated with AY 2026-27 under the earlier framework. Income earned from 1 April 2026 belongs to Tax Year 2026-27 under the new Act.

Source: Income Tax Department — Tax Year 2026-27 rates.

Try Tax Regime Calculator →

Frequently asked questions

What section contains the new regime now?

For Tax Year 2026-27 onwards, the new regime is provided under section 202 of the Income-tax Act, 2025.

Can I still choose the old regime?

Yes. The new regime is the default, but eligible taxpayers can opt for the old regime subject to applicable conditions.

Should this be labelled AY 2027-28?

A current calculator should clearly label the new framework as Tax Year 2026-27.