Section 87A Rebate & Marginal Relief Calculator
Calculate your tax savings from Section 87A rebate and evaluate the marginal tax relief for incomes slightly above ₹12 Lakhs under the New Regime.
Taxable Income Details
Calculation Methodology & Rules
The Section 87A Rebate & Marginal Relief Calculator lets you evaluate how the tax rebate benefits apply to your taxable income under the current guidelines.
Rebate Thresholds & Max Rebate (FY 2025-26 / AY 2026-27)
| Tax Regime | Taxable Income Threshold | Maximum Rebate Amount | Marginal Relief Available |
|---|---|---|---|
| New Tax Regime | Up to ₹12,00,000 | ₹60,000 | Yes (for incomes slightly above ₹12 Lakhs) |
| Old Tax Regime | Up to ₹5,00,000 | ₹12,500 | No |
Marginal Relief Math (New Regime)
Without marginal relief, an income of ₹12,05,000 would attract a tax of ₹60,750 (before cess), while an income of ₹12,00,000 would pay ₹0. Marginal relief limits the tax to the excess income:
- Tax Payable = Min(Calculated Base Tax, Taxable Income - ₹12,00,000).
- For ₹12,05,000: Tax = Min(₹60,750, ₹5,000) = ₹5,000. Relief = ₹55,750.
Frequently Asked Questions
Section 87A is a tax rebate that reduces tax liability to zero for taxpayers whose net taxable income falls below a specified threshold. For FY 2025-26, the threshold is ₹12 Lakhs under the New Regime and ₹5 Lakhs under the Old Regime.
If your taxable income slightly exceeds ₹12 Lakhs under the New Regime (for example, ₹12,10,000), the tax payable is capped at the amount by which your income exceeds ₹12 Lakhs (i.e. ₹10,000). This prevents a small increase in income from causing a massive tax bill.
No. The Section 87A rebate cannot be claimed against tax liabilities arising from Long-Term Capital Gains under Section 112A (on shares) or Short-Term Capital Gains under Section 111A (on shares).
For FY 2025-26, the maximum rebate is ₹60,000 under the New Tax Regime (equal to the tax on ₹12 Lakhs income) and ₹12,500 under the Old Tax Regime (equal to the tax on ₹5 Lakhs income).