Salaried employees could see a slight increase in their take-home salary from April 1, 2026, as India prepares to implement the new Income-tax Act, 2025, replacing the decades-old Income-tax Act, 1961.

One of the key reasons for higher in-hand salary is the standard deduction benefit available under the new tax regime, which currently stands at Rs 75,000 for salaried individuals. This reduces taxable income and can increase disposable income.

Under the new tax regime, taxpayers earning up to Rs 12 lakh annually can effectively pay zero income tax due to the Section 87A rebate, while salaried individuals can enjoy tax-free income up to about Rs 12.75 lakh after including the standard deduction.

Although income-tax slabs remain unchanged for FY 2026-27, the rollout of the new tax law from April is expected to simplify compliance and maintain tax relief measures introduced in recent budgets.

Overall, the upcoming tax changes are aimed at simplifying the tax system while ensuring that salaried taxpayers continue to benefit from deductions and rebates, which could slightly improve monthly take-home salary depending on income level and tax regime chosen.