Old vs New Regime Calculator (with HRA)

⚡ In shortMost regime comparisons quietly leave out HRA — and for a salaried person paying real rent in a metro, the HRA exemption is frequently the single largest deduction, big enough to flip the answer.

Open the free Old vs New Regime Calculator (with HRA) →

How it is calculated

The new regime is the default: a ₹75,000 standard deduction, wider slabs, and income up to ₹12 lakh effectively tax-free through the §87A rebate — but no HRA, no 80C, no 80D and no §24(b). The old regime has narrower slabs and a ₹50,000 standard deduction, but allows all of them. This calculator first computes your HRA exemption under §10(13A) — the least of the actual HRA received, rent paid minus 10% of Basic+DA, and 50% of Basic+DA in a metro (40% elsewhere) — then feeds that into the old regime alongside 80C, 80D and home-loan interest, and compares the result against the new regime. As a rough rule the old regime only wins once your total deductions are large, which for most renters means a high rent plus a full 80C plus meaningful home-loan interest.

Most comparisons omit the largest deduction

HRA is frequently the single biggest deduction available to a salaried taxpayer paying real rent in a city, and a great many online regime comparisons leave it out entirely. Excluding it makes the new regime look better than it is for exactly the group most likely to benefit from the old one. Any comparison that does not ask what rent you pay is not answering your question.

The exemption is the lowest of three tests

HRA exemption is the least of: the actual HRA received; rent paid minus 10% of salary; and 50% of salary for Delhi, Mumbai, Kolkata or Chennai, or 40% elsewhere. Salary here means basic plus dearness allowance, not CTC. Only those four cities count as metro — Bengaluru, Hyderabad, Pune and Ahmedabad do not, and assuming otherwise inflates the exemption and eventually produces a query.

What each regime actually gives you

The old regime allows HRA, LTA, 80C, 80D, home-loan interest on a self-occupied property and the rest of the familiar list. The new regime gives lower rates, a ₹75,000 standard deduction for salaried taxpayers, and the employer's NPS contribution under section 80CCD(2) — and takes the others away. The comparison is therefore between real, evidenced deductions and a lower rate structure, not between two rate tables.

Who may switch, and when

The new regime is the default, so doing nothing selects it. Salaried taxpayers may choose afresh each year at the time of filing. Taxpayers with business or professional income must file Form 10-IEA to opt for the old regime and cannot move back and forth freely. Whatever you declare to payroll in April determines the tax deducted through the year, so a late change produces a large refund or demand rather than a smooth twelve months.

Compute it once a year on real numbers

The answer changes as your circumstances do — a rent increase, a home loan ending, a change of city, or a shift in the standard deduction can all flip it. Run both computations on your actual figures each year rather than deciding once and carrying the decision forward. And remember the ₹12 lakh nil-tax point in the new regime is a section 87A rebate: residents only, and it does not extend to income taxed at special rates such as equity capital gains.

Frequently asked questions

Can I claim HRA under the new tax regime?

No. The HRA exemption under §10(13A) is available only under the old regime. The new regime gives a larger standard deduction and wider slabs instead.

How much rent do I need for the old regime to win?

There is no fixed number — it depends on your salary, Basic, and other deductions. Run both with your real figures; the old regime typically needs a large HRA exemption plus a full 80C before it beats the new slabs.

Do I need my landlord's PAN?

Yes, if your annual rent exceeds ₹1,00,000. Keep rent receipts either way — HRA claims are a common item in scrutiny.

Can I switch regimes every year?

A salaried person with no business income can choose afresh each year while filing. Someone with business income who opts out of the new regime can generally return to it only once.