Income Tax on ₹10 Lakh Annual Salary
If your annual income is ₹10 lakh (approximately ₹83,333 per month), your tax liability depends on which regime you choose and how well you plan your deductions. With smart planning, you can reduce your tax on ₹10 lakh salary to as low as ₹23,400 — or even zero in some cases.
New Tax Regime (Default)
- Income: ₹10,00,000
- Standard deduction: ₹75,000
- Taxable income: ₹9,25,000
- Tax calculation: ₹0-3L = nil | ₹3-7L = 5% (₹20,000) | ₹7-9.25L = 10% (₹22,500)
- Total tax: ₹42,500
- Health & education cess (4%): ₹1,700
- Total payable: ₹44,200
Note: Under the new regime, very few deductions are allowed. No 80C, no HRA, no 80D (except employer NPS under 80CCD2).
Old Tax Regime (With Deductions)
- Income: ₹10,00,000
- Standard deduction: ₹50,000
- Section 80C (EPF+PPF+ELSS): ₹1,50,000
- Section 80CCD(1B) NPS: ₹50,000
- Section 80D (health insurance): ₹25,000
- Taxable income: ₹7,25,000
- Tax: ₹0-2.5L = nil | ₹2.5-5L = 5% (₹12,500) | ₹5-7.25L = 20% (₹45,000)
- Total tax: ₹57,500
- Section 87A rebate: ₹0 (income above ₹5 lakh taxable)
- Cess (4%): ₹2,300
- Total payable: ₹59,800
Old Regime With HRA + Home Loan
- Income: ₹10,00,000
- Standard deduction: ₹50,000
- HRA exemption: ₹1,20,000 (paying ₹15,000 rent in metro)
- 80C: ₹1,50,000
- 80CCD(1B): ₹50,000
- 80D: ₹50,000 (self ₹25K + senior citizen parents ₹25K)
- Taxable income: ₹4,80,000
- Tax: ₹0-2.5L = nil | ₹2.5-4.8L = 5% (₹11,500)
- Section 87A rebate: ₹11,500 (full rebate as taxable income under ₹5L)
- Total tax payable: ₹0! 🎉
Yes, you can pay ZERO tax on ₹10 lakh salary with the right deductions in the old regime!
Which Regime is Better for ₹10 Lakh?
- New regime: ₹44,200 tax — Choose if you have minimal deductions (no HRA, no home loan, limited 80C investments)
- Old regime with basic deductions: ₹59,800 tax — Worse than new regime if you only have 80C and NPS
- Old regime with HRA + full deductions: ₹0 tax — Best option if you pay rent and maximise all deductions
Key insight: For ₹10 lakh salary, old regime wins ONLY if your total deductions exceed ₹3.75 lakh (80C + 80D + HRA + NPS combined). Otherwise, stick with new regime.
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