The standard deduction is a flat cut from salary before the slabs are worked out. You do not submit bills for it. It is not a reimbursement, and it is not the same thing as HRA.
Section 19(1), table item 2, of the Income-tax Act, 2025 sets the amount for FY 2026-27. Where tax is computed under section 202(1), it is ₹75,000 or the salary, whichever is less. In any other case it is ₹50,000 or the salary, whichever is less. Before 1 April 2026 this sat in section 16(ia) of the 1961 Act. A return for FY 2025-26 still uses that old number. A return for FY 2026-27 uses section 19.
It is only for income under the head “Salaries”. A person with business or professional income does not get it on that income. Pension that is taxed as salary can get it. Family pension is a different deduction, with its own ceiling. Do not type family pension into the salary box and expect this flat cut.
The ₹75,000 figure is why a salaried person can have salary of ₹12,75,000 and still land on ₹12,00,000 of total income, where section 156 can wipe the tax. A self-employed person with receipts of ₹12,00,000 is already on the line, with nothing further to deduct under this section.
A worked example
Mark ₹15,00,000 as salary in the new regime. The engine subtracts ₹75,000. Taxable income is ₹14,25,000. Slab tax is ₹93,750, cess is ₹3,750, and the bill is ₹97,500.
Leave the same ₹15,00,000 unmarked, so it is not salary. Taxable income stays ₹15,00,000 and the bill is ₹1,09,200. The only change is the standard deduction. In the old regime the same salary, with the ₹1,50,000 section 123 cap also claimed, uses a standard deduction of ₹50,000. Taxable income is then ₹13,00,000.
Both regimes on the income tax calculator apply the figure that matches the regime, and only when you mark the income as salary. The in-hand salary calculator uses it when it turns CTC into pay after tax.
Mistakes people make
- Claiming ₹75,000 in the old regime, or ₹50,000 in the new one.
- Claiming it on freelance receipts, rent, or interest.
- Adding it on top of a full HRA exemption as if both were the new regime. HRA exemption is an old-regime rule. The standard deduction is in both.
- Forgetting it and then thinking the rebate failed. Salary of ₹12,75,000 needs this cut before total income is ₹12,00,000.
The section
Section 19, table item 2 (this was section 16(ia)). The ₹75,000 amount applies only when tax is computed under section 202(1) (this was section 115BAC). The slab guide and the regime guide both use this split.
Questions
Can a freelancer claim the standard deduction?
Not on business or professional receipts. Section 19 gives it on salary. The same ₹15,00,000 entered as non-salary income stays ₹15,00,000 and the new-regime bill is ₹1,09,200, against ₹97,500 when it is marked as salary.
Is the standard deduction ₹75,000 in both regimes?
No. Under section 202(1) it is ₹75,000 or the salary, whichever is less. In any other case it is ₹50,000 or the salary, whichever is less. The income tax calculator switches the figure when you switch regime.
Do I need bills for the standard deduction?
No. It is a flat cut from salary. You do not attach rent receipts or investment proofs for this one line. Those proofs belong to other deductions, and most of those other deductions are only in the old regime.
Sources
Figures checked 28 Oct 2026.