Old vs new regime decision checklist

The old-versus-new regime choice is the biggest annual tax decision most individuals make. This checklist walks you through it: add up your genuine old-regime deductions, see whether they beat the new regime's Rs 12 lakh tax-free band, and check the special-rate-income and business-income wrinkles before you commit. Run the actual numbers both ways with the Regime Optimiser before deciding.

Last reviewed: 29 May 2026

Guidance, not advice. We explain the rules, we don't assess your situation. Always seek financial or tax advice from your accountant, or contact Income Tax Department. Read our editorial scope →

What it contains

A step-by-step checklist to total old-regime deductions, compare regimes, and handle the special-rate-income and business-income switching rules.

How to use it

Total your deductions honestly

Only count deductions you genuinely have and will keep, not aspirational ones. Inflating the old-regime stack to justify it is self-defeating.

Run both with the optimiser

Use the Regime Optimiser to compute the actual tax both ways, the Rs 12 lakh tax-free band means the new regime wins for far more people than the old advice assumed.

Mind the business-income lock

If you have business income, opting out of the new regime uses Form 10-IEA and you can move out and back only once in a lifetime, so choose deliberately.

Copy the letter text

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OLD vs NEW REGIME - DECISION CHECKLIST (TAX YEAR 2026-27)

  STEP 1 - Total your genuine OLD-REGIME deductions:
  [ ] 80C (EPF/PPF/ELSS/life insurance/home-loan principal/tuition) - up to Rs 1,50,000
  [ ] 80CCD(1B) NPS - extra Rs 50,000
  [ ] 80D health insurance - up to Rs 25,000 / Rs 50,000 (with seniors)
  [ ] 24(b) self-occupied home-loan interest - up to Rs 2,00,000
  [ ] 80TTA/80TTB savings/deposit interest, 80E education loan, 80G, 80GG, 80U/80DDB
  -> TOTAL old-regime deductions = Rs __________

  STEP 2 - Compare:
  [ ] New regime: income up to Rs 12 lakh is tax-free (Rs 4L exemption + Rs 60k rebate); + Rs 75k standard deduction if salaried
  [ ] Old regime: lower exemptions, but your full deduction stack applies; 87A only up to Rs 5 lakh
  [ ] Rule of thumb: the bigger your genuine deductions, the more likely the OLD regime wins; modest deductions -> NEW regime usually wins

  STEP 3 - Check the wrinkles:
  [ ] Special-rate income (equity gains 112A/111A, crypto 115BBH) is taxed separately and NOT covered by the 87A rebate either way
  [ ] Employer NPS (80CCD(2)) is deductible even on the NEW regime - the one survivor
  [ ] If you have BUSINESS income and want the old regime, file Form 10-IEA; you can move out and back only ONCE in a lifetime

  STEP 4 - Decide:
  [ ] Run both regimes on the Regime Optimiser with your actual numbers
  [ ] Pick the lower total tax; if salaried with no business income, you can switch each year