Old vs new regime at ₹20 lakh: which leaves more in hand?
At ₹20 lakh the new regime wins comfortably for most people — by about ₹8,063 a month. The old regime only makes sense with a large, specific deduction stack. Here's the side-by-side and the exact break-even.
At ₹20 lakh the new regime wins by about ₹8,063 a month. The old regime only overtakes it above about ₹6,85,100 in deductions.
- New regime · monthly in-hand
- ₹1,44,033
- Old regime · monthly in-hand
- ₹1,35,971
- New regime · income tax + cess
- ₹1,77,902
- Old regime · income tax + cess
- ₹2,74,654
The break-even deduction at ₹20 lakh
Under the new regime your annual tax is about ₹1,77,902 and your in-hand about ₹1,44,033 a month. The old regime, even with full deductions, runs about ₹2,74,654 in tax and ₹1,35,971 a month — so the new regime is ahead by roughly ₹8,063 a month.
For the old regime to overtake it, you'd need to claim more than about ₹6,85,100 in total deductions. That's a high bar — it usually takes metro-city rent (for a large HRA exemption) plus home-loan interest on top of a maxed 80C and 80D. Most people at ₹20 lakh don't reach it, so the new regime is the safe default.
When each regime wins
New regime wins if…
- You're on a standard salary with the usual deductions or fewer.
- You don't have a home loan.
- You'd keep about ₹8,063 more a month with no extra paperwork.
Old regime wins if…
- Your total deductions exceed about ₹6,85,100.
- You rent in a metro and pay home-loan interest, on top of maxed 80C/80D.
Check your own numbers
Pre-filled for a ₹20 lakh CTC in a metro city with ₹25,000/mo rent. Enter your real rent and investments to see which regime wins for you.
Helps old-regime HRA exemption
New regime puts ₹8,063 more in your pocket every month.
Salary breakup · per year
₹69,700 of your CTC is employer contributions & benefits — real value, but never a monthly bank credit.
Old vs New, side by side
| Metric | Old | New |
|---|---|---|
| Taxable income | ₹15,05,300 | ₹18,55,300 |
| Income tax + cess | ₹2,74,654 | ₹1,77,902 |
| Annual in-hand | ₹16,31,646 | ₹17,28,398 |
| Monthly in-hand | ₹1,35,971 | ₹1,44,033 |
How we calculate this
- Basic = 50% of CTC; HRA = 50% of Basic; PF capped at ₹1,800/mo (statutory ceiling); Gratuity = 4.81% of Basic. Change these under “Match your offer letter”.
- Employee PF (₹1,800/mo) is deducted from your salary.
- New regime: ₹75,000 standard deduction, FY 2026-27 slabs, no other exemptions.
- Old-regime estimate assumes full ₹1.5L under 80C, ₹25K under 80D, plus HRA exemption from the rent you entered. Flexible-benefit / reimbursement exemptions (RFB, LTA, food, telephone) aren’t counted unless you add them under “Match your offer letter”.
- 4% health & education cess and ₹200/month professional tax applied.
Tax rules: Budget 2026 retained FY 2025-26 slabs unchanged. Verified against Income Tax Dept (incometax.gov.in) & ClearTax, July 2026. Updated 2026-07-02.
Estimates only — not tax or financial advice. Your actual pay depends on your company’s exact salary structure and your declared investments. Verify with a professional before deciding.
Frequently asked questions
Is old or new regime better for 20 lakh salary?
- The new regime, by about ₹8,063 a month. The old regime only wins if your total deductions exceed about ₹6,85,100, which usually needs metro rent plus home-loan interest.
How much tax on 20 lakh salary?
- About ₹1,77,902 a year under the new regime, versus roughly ₹2,74,654 under the old regime even after full deductions.
What is the break-even deduction at 20 lakh?
- About ₹6,85,100 in total deductions. Below that the new regime wins; above it the old regime does.
What is the in-hand for 20 lakh under each regime?
- About ₹1,44,033 a month under the new regime and ₹1,35,971 under the old, on a metro city with standard CTC components.
Related comparisons and tools
Estimates only — not tax or financial advice. Your actual pay depends on your company’s exact salary structure and your declared investments. Tax rules: Budget 2026 retained FY 2025-26 slabs unchanged. Verified against Income Tax Dept (incometax.gov.in) & ClearTax, July 2026.