TDS on Salary Calculator

New regime slabs for FY 2026-27 (AY 2027-28)

Budget 2026 left slabs and rates untouched under both regimes, so these carry over from FY 2025-26. The new regime is the default: if the employee does not declare a choice, this is what the employer must use.

A standard deduction of ₹75,000 applies to salary, and a rebate of up to ₹60,000 wipes out the tax when taxable income is ₹12,00,000 or less. Put together, a salaried person with no other income pays nothing up to ₹12,75,000. Health and education cess of 4 percent sits on top of tax plus surcharge.

The old regime is still available on declaration. Its slabs are nil up to ₹2,50,000 (₹3,00,000 at 60 to 79, ₹5,00,000 at 80 and above), then 5 percent to ₹5,00,000, 20 percent to ₹10,00,000 and 30 percent above that, with a ₹50,000 standard deduction and a rebate up to ₹5,00,000 of taxable income. It is the only route to 80C, 80D, HRA exemption and home loan interest relief.

Rebate, marginal relief and surcharge

Three adjustments sit between the slab tax and the final number, and payroll teams get them wrong more often than the slabs themselves.

• Rebate: up to ₹60,000 in the new regime when taxable income is ₹12,00,000 or less, up to ₹12,500 in the old regime up to ₹5,00,000. The rebate can never be more than the tax itself.
• Marginal relief on the rebate: just above ₹12,00,000 the tax would jump far more than the extra income. The law caps the tax at the amount by which income exceeds ₹12,00,000. At ₹12,15,000 the slab tax is ₹62,250, but the tax payable is held to ₹15,000 plus cess.
• Surcharge: 10 percent above ₹50 lakh, 15 percent above ₹1 crore and 25 percent above ₹2 crore. The old regime adds a 37 percent band above ₹5 crore; the new regime stops at 25 percent. Marginal relief applies at each threshold, so tax plus surcharge can never rise by more than the income that crossed the line.

Deposit, return and certificate deadlines

Deducting but depositing late costs 1.5 percent per month or part of a month; not deducting at all costs 1 percent per month. A late return costs ₹200 a day, capped at the TDS involved, and a late certificate costs ₹100 per day per certificate. Salary on which TDS was never deducted or deposited can also be partly disallowed as a business expense in the employer's own tax computation.

Where salary TDS usually goes wrong

• Ignoring the previous employer. Two employers in one year each give the full exemption limit and the full standard deduction, so the employee is under deducted and gets a demand at filing time. The employee has to declare the earlier salary and the TDS on it; the new employer then deducts on the combined figure.
• Collecting the regime choice late. Months already deposited cannot be re-cut. Ask every employee for the declaration in the first fortnight of April and treat silence as the new regime.
• Deducting on promised bonuses. Building an unconfirmed variable payout into the estimate squeezes the employee's cash flow for months until the refund arrives. Add it in the month it is confirmed and re-spread.
• Not re-cutting in January. Most payrolls run on declarations until December and on actual proofs from January. If an employee invested less than declared, the shortfall has to be recovered across the last quarter, not left for the return.
• Skipping the certificate for leavers. Anyone from whom TDS was deducted during the year is owed a certificate, including people who resigned in June.

Assumptions this calculator makes

• Financial year 2026-27 (AY 2027-28), resident individual, salary income taxed at slab rates. Capital gains and other specially rated income are not modelled and cannot take the rebate.
• The whole remaining liability is spread evenly over the months you say are left. Real payrolls re-cut the figure every time the estimate changes, which is exactly what re-running this calculator in a later month does.
• Surcharge and its marginal relief are applied at the ₹50 lakh, ₹1 crore, ₹2 crore and (old regime) ₹5 crore thresholds. Marginal relief on the Section 87A rebate is applied just above ₹12,00,000.
• The employer NPS contribution is treated purely as a deduction from the salary figure you entered, so include it in that salary figure if it forms part of your CTC. The deduction is capped at 14 percent of basic plus DA in the new regime; in the old regime the cap is 10 percent for private sector employees and 14 percent for government employees. Enter the lower of the actual contribution and the cap that applies.
• Perquisite valuation, foreign currency salary, relief for arrears and any tax the employer chooses to bear on non monetary perquisites are outside the scope of this tool.
• Rounding of total income and tax to the nearest ten rupees, which the Act requires, is not applied, so figures can differ from a payroll system by a few rupees.

What is still moving

• Form numbers. The certificate (Form 130) and the quarterly return (Form 138) are settled. The investment and HRA declaration that replaced Form 12BB is Form 124. We could not confirm from an official source the new numbers for the old Form 12B (previous employer salary) and Form 12BAA (unverified, no public source found by us), so check the official form mapping guide before circulating them to staff.
• Arrears relief. Relief for salary arrears that belong to earlier years is still claimed through the Form 10E route, and an employer can factor it into TDS if the employee supplies the computation. It is not built into this calculator.