Do I have to pay income tax of Rs 9 lakh on a salary of Rs 30 lakh? Know how you will save money in the new tax regime

Income Tax: Often people think that if someone’s annual salary is Rs 30 lakh, then he will have to pay direct income tax of 30% i.e. around Rs 9 lakh. But this does not happen in the new tax regime. Tax is not levied on the entire salary at the rate of 30%, but is levied according to different income groups (slabs). This is the reason why the actual tax is much less than this.

According to chartered accountant Santosh Mishra, salaried employees get a standard deduction of Rs 75,000 in the new tax regime. That means, if someone’s annual salary is Rs 30 lakh, then first Rs 75,000 will be deducted. After this, tax will be calculated on taxable income of Rs 29.25 lakh.

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The slabs of the new tax regime for AY 2026-27 (FY 2025-26) are as follows…

• Up to Rs 4 lakh – no tax
• 4 Lakh to 8 Lakh – 5%
• 8 Lakh to 12 Lakh – 10%
• 12 lakh to 16 lakh – 15%
• 16 lakh to 20 lakh – 20%
• 20 lakh to 24 lakh – 25%
• Above Rs 24 lakh – 30%

This does not mean that the entire income of Rs 29.25 lakh will be taxed at 30%. The rate of 30% will be applicable only on income above Rs 24 lakh, i.e. Rs 5.25 lakh. The remaining income will be taxed at the rate of 5% to 25% as per the respective slab.

According to this calculation, the total income tax comes to Rs 4,57,500. After adding 4% health and education cess to this, the total tax becomes Rs 4,75,800.

According to Chartered Accountant Abhinandan Pandey, if we compare the total tax with the total salary, then the effective tax rate is around 15.86%. That means, on an annual salary of Rs 30 lakh, tax has to be paid not 30%, but about 15.86%.

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Experts say that the biggest reason for this is that the tax slab system is implemented in India, in which the tax rate of each slab is applicable only on that part of the income. Apart from this, standard deduction of Rs 75,000 also reduces the taxable income.