Income tax slab rates for AY 2024-25 (FY 2023-24) under the new default regime and old regime, with section 87A rebate up to ₹7 lakh explained.
Although AY 2024-25 corresponds to FY 2023-24 income, taxpayers in FY 2026-27 still file rectifications, revised returns and reassessments for that year. Understanding the slab structure that applied for FY 2023-24 is also useful for comparison with the current Finance Act 2026 rates. The big shift in FY 2023-24 was the new tax regime becoming the default under section 115BAC, with the basic exemption raised to ₹3 lakh and the section 87A rebate extended up to ₹7 lakh of total income.
New Tax Regime Slabs for FY 2023-24
- Up to ₹3,00,000 — nil
- ₹3,00,001 to ₹6,00,000 — 5%
- ₹6,00,001 to ₹9,00,000 — 10%
- ₹9,00,001 to ₹12,00,000 — 15%
- ₹12,00,001 to ₹15,00,000 — 20%
- Above ₹15,00,000 — 30%
A standard deduction of ₹50,000 was introduced into the new regime for salaried taxpayers and pensioners from FY 2023-24, along with a family pension deduction of ₹15,000. Surcharge for income above ₹5 crore was capped at 25% under the new regime, a reduction from 37% in the old regime.
Old Tax Regime Slabs for FY 2023-24
- Up to ₹2,50,000 — nil
- ₹2,50,001 to ₹5,00,000 — 5%
- ₹5,00,001 to ₹10,00,000 — 20%
- Above ₹10,00,000 — 30%
Senior citizens (60-79) had a basic exemption of ₹3 lakh and super seniors (80+) ₹5 lakh under the old regime only. The old regime continues to allow Chapter VI-A deductions like 80C, 80D, 80G, HRA and home loan interest under section 24(b).
Section 87A Rebate Mechanics
Under the new regime, a resident individual with total income up to ₹7 lakh got a full rebate, making tax liability nil. Marginal relief was provided for income marginally above ₹7 lakh to ensure that incremental tax did not exceed incremental income. The old regime rebate remained at ₹12,500 for incomes up to ₹5 lakh.
Choosing Between Regimes
Salaried individuals could switch every year, but business and professional income earners exercising the option under section 115BAC(6) needed Form 10-IEA. The break-even depended on total deductions claimed — generally, deductions exceeding ₹3.75 lakh tilted the math toward the old regime, while standard-deduction-only filers benefited from the new regime.
Conclusion
FY 2023-24 marked the structural shift toward the new regime as the default. For any revised return, rectification or refund claim for AY 2024-25 still pending, ensure the regime election, rebate and surcharge are correctly applied per Finance Act 2023 provisions.
