New regime is default. Should you opt out?

Since FY 2023-24the New tax regime has been the default. If your employer's payroll system defaulted you, your TDS in April 2026 is being computed under New regime rules — meaning HRA exemption, 80C, 80D, NPS, home loan interest are all not reducing your taxable income at the slip level.

That can be the right answer for some people. For many salaried 22-30 year olds with rent and basic 80C investments, it's the wrong answer — costing them ₹15K-50K a year.

Slabs side by side (FY 2025-26)

New regime — std deduction ₹75,000:

• 0 – ₹3L: 0%
• ₹3L – ₹7L: 5%
• ₹7L – ₹10L: 10%
• ₹10L – ₹12L: 15%
• ₹12L – ₹15L: 20%
• ₹15L+: 30%

Old regime — std deduction ₹50,000:

• 0 – ₹2.5L: 0%
• ₹2.5L – ₹5L: 5%
• ₹5L – ₹10L: 20%
• ₹10L+: 30%

New has wider zero-tax and lower-rate bands at the start, but you give up most deductions. Old has narrower bands but lets you stack deductions to lower your taxable base.

Three real-world examples

Profile A — ₹8 LPA, no rent, no 80C

New regime wins. Std deduction ₹75K → taxable ₹7.25L → tax ~₹27K before 87A rebate. Old regime would tax similarly but you gain nothing from deductions. Stay on New.

Profile B — ₹12 LPA, ₹15K rent in metro, ₹1L in 80C

Old regime wins. HRA exemption is ~₹1.4L (50% of basic), 80C ₹1L, std ₹50K → deductions ~₹2.9L. Taxable income drops to ~₹9.1L → tax ~₹95K. Under New regime, tax ~₹1.05L. Old saves ~₹10K/year. Switch at ITR.

Profile C — ₹18 LPA, ₹25K rent metro, ₹1.5L 80C, ₹25K 80D, ₹50K NPS

Old regime wins comfortably. HRA ~₹2L + 80C ₹1.5L + 80D ₹25K + NPS ₹50K + std ₹50K = ~₹4.75L deductions. Taxable ~₹13.25L → tax ~₹2.1L. Under New regime: ~₹2.4L. Old saves ~₹30K/year.

How to opt out

Two ways:

• At your employer (mid-year):ask payroll to switch your TDS computation to Old regime. They'll need a fresh declaration of your investments and rent. Some companies allow only once a year (typically April). Most are flexible if you push.
• At ITR filing (default route):when filing your ITR (deadline July 31, 2026 for FY 2025-26), select "Old regime" in the form. This is allowed every year for salaried employees — you can switch back next year if you want.

How Splexo answers this for you specifically

Open the Splexo app → Tax calculator → enter your salary, rent, 80C, 80D, NPS, home loan interest → tap "Calculate." You see the Old vs New comparison side by side, with the exact ₹ saved either way and a recommendation.

We don't guess. We don't hallucinate. The math is based on the FY 2025-26 Finance Act slabs, every citation linked. If your rent + 80C + 80D add up, Splexo will tell you Old regime saves you ₹X — and Splex can help you reorder the rest of your finances around the savings.