Section 115BAC · Default new tax regime for individuals and HUFs
The default new regime — lower slabs, fewer deductions.
- AY 2026-27 basic slab
- Nil up to ₹4,00,000
- Standard deduction
- Up to ₹75,000
- 87A rebate (resident individual)
- Up to ₹60,000 if total income ≤ ₹12 lakh
- Default regime
- Yes — eligible taxpayers may opt out
In plain English
For AY 2026-27, Section 115BAC(1A) remains the default regime. The slab rate is nil up to ₹4 lakh, then 5% to ₹8 lakh, 10% to ₹12 lakh, 15% to ₹16 lakh, 20% to ₹20 lakh, 25% to ₹24 lakh and 30% above ₹24 lakh. A resident individual can claim rebate under Section 87A up to ₹60,000 where total income does not exceed ₹12 lakh, subject to the statutory conditions. Salaried taxpayers can claim a standard deduction up to ₹75,000.
| Meaning | Number |
|---|---|
| AY 2026-27 basic slab | Nil up to ₹4,00,000 |
| Standard deduction | Up to ₹75,000 |
| 87A rebate (resident individual) | Up to ₹60,000 if total income ≤ ₹12 lakh |
What this section covers
For AY 2026-27, Section 115BAC(1A) is the default regime for individuals, HUFs, AOPs (other than co-operative societies), BOIs and artificial juridical persons. The slab rates are: up to ₹4 lakh nil; ₹4,00,001–₹8 lakh 5%; ₹8,00,001–₹12 lakh 10%; ₹12,00,001–₹16 lakh 15%; ₹16,00,001–₹20 lakh 20%; ₹20,00,001–₹24 lakh 25%; above ₹24 lakh 30%. A resident individual may claim the Section 87A rebate up to ₹60,000 where total income does not exceed ₹12 lakh, subject to the statutory rules. Salaried taxpayers and pensioners can claim standard deduction up to ₹75,000 in the new regime. Taxpayers without business or professional income can opt out directly in the return; eligible taxpayers with business or professional income use Form 10-IEA within the statutory time limit and cannot switch every year.
Read the legal text
“Notwithstanding anything contained in this Act but subject to the provisions of this Chapter, the income-tax payable in respect of the total income of a person, being an individual or Hindu undivided family or association of persons (other than a co-operative society), or body of individuals… shall be computed at the rates given in the Table…”
Old Act vs New Act
| Aspect | Act, 1961 | Act, 2025 |
|---|---|---|
| Section | 115BAC | 202 |
| Topic | Default new tax regime for individuals and HUFs | |
| Verdict | Mapped to Section 202 — reviewed | |
| Notes | The Income Tax Department transition FAQ confirms old Section 115BAC maps to Section 202. AY 2026-27 is still governed by the 1961 Act; the current AY 2026-27 slabs and Section 87A rebate were re-checked against the official e-Filing ITR-2 FAQ. From Tax Year 2026-27, the corresponding new-regime provision is Section 202 of the Income-tax Act, 2025. | |
Common confusion
Form 10-IEA is not required merely because a salaried taxpayer wants the old regime. Taxpayers without business or professional income can opt out directly in the ITR. Eligible taxpayers with business or professional income must use Form 10-IEA within the applicable due-date rules, and their ability to switch regimes later is restricted.
Who should know this
Related sections
Based on the official Income-tax Act, 1961 and the published Income-tax Act, 2025 as available on the Income Tax Department website. Always verify against the published Act and consult a qualified professional.
What was checked
115BAC → 202: Mapping and continuation of the default new tax regime re-checked. AY 2026-27 slab rates, ₹60,000 Section 87A rebate up to ₹12 lakh total income, and the non-business/business opt-out distinction were separately checked against the official e-Filing portal; standard deduction ₹75,000 was re-checked against Income Tax Department guidance. FAQs on Interplay and Transition from the Income-tax Act, 1961 to the Income-tax Act, 2025