1. Introduction

Anticipation is rising around the possible 8th Pay Commission (8th CPC) in India, which would affect Central/State Government employees and faculty members of institutes like IITs, NITs, and Central Universities. While no official announcement has been made yet, a tentative 8th CPC Salary Calculator offers an imaginary estimation of potential salary structures.

Simultaneously, the Union Budget 2025 has introduced significant income tax updates under the new regime—raising rebates, altering tax slabs, and giving taxpayers the choice between old and new tax systems. This article provides a trusted, expert, and in-depth look at both topics. Keep in mind that official figures may differ once the government finalizes the 8th CPC and any new tax regulations.

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2. 8th CPC Salary Calculator: Tentative Overview

A popular reference is the 8th CPC Salary Calculator (Tentative) from websites like Sarkaribot Users typically select:

• Pay Level (AGP for faculty or GP for other employees)
• Basic Pay
• Fitment Factor (tentative range from 1.92 to 2.86)
• City Category for HRA (X, Y, Z, or no HRA)
• City Category for TA (TPTA city or others)
• DA Percentage

Disclaimer: The calculator is purely imaginary—it does NOT reflect any official 8th CPC policy.

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3. Historic Comparison of Pay Commissions

Below is a table illustrating the evolution of fitment factors, minimum pay, and percentage increases:

Pay Commission	Fitment Factor	% of Increase	Minimum Pay
2nd CPC	–	14.2%	Rs.70
3rd CPC	–	20.6%	Rs.196
4th CPC	–	27.6%	Rs.750
5th CPC	–	31%	Rs.2550
6th CPC	1.86	54%	Rs.7000
7th CPC	2.57	14.29%	Rs.18000
8th CPC	1.92 – 2.86	TBD	TBD

Again, 8th CPC data is purely tentative and subject to official confirmation.

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4. Key Components in the Tentative 8th CPC Calculator

1. Fitment Factor (1.92 – 2.86)

• Determines how your basic pay translates from the 7th CPC to the 8th CPC.
• A higher factor implies a higher jump in salary.

2. Allowances and HRA Classification

Dearness Allowance (DA)

• Under the tentative 8th CPC, you can choose a DA percentage (e.g., Nil to future rates).

House Rent Allowance (HRA)

• X City (≥ 50 lakh population): 30% of Basic Pay
• Y City (5 to 50 lakh): 20% of Basic Pay
• Z City (< 5 lakh): 10% of Basic Pay

3. Transport Allowance (TA)

Pay Level	Highest TPTA Cities	Other Places
9 and above	Rs. 7200 + DA	Rs. 3600 + DA
3 to 8	Rs. 3600 + DA	Rs. 1800 + DA
1 and 2	Rs. 1350 + DA	Rs. 900 + DA

TPTA cities include metros and select tier-2 cities such as Delhi, Mumbai, Bangalore, Pune, etc.

4. NPS and Other Deductions

NPS

• Employee Contribution: 10% of (Basic + DA)
• Employer Contribution: 14% of (Basic + DA)

CGHS

• Monthly deductions depend on pay level:
  • Level 1-5: Rs. 250
  • Level 6: Rs. 450
  • Level 7-11: Rs. 650
  • Level 12+: Rs. 1000

HPCA/PCA

• Level 8 & below: Rs. 4100
• Level 9 & above: Rs. 5300

NPA (Non-Practising Allowance)

• 20% of Basic Pay for eligible professionals.

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5. Income Tax Overview: Old vs. New Regime (Budget 2025)

Individuals Can Choose Old or New Tax Regime

1. Old Regime: Allows several deductions and exemptions (e.g., HRA, 80C).
2. New Regime: Offers lower tax rates but restricts most exemptions and deductions.

What Is the Income Tax Calculator?

An income tax calculator is an online tool that lets you compute your tax liability under both regimes, helping you choose which one is more beneficial. Our recommended approach:

• Compare old vs. new regimes side by side.
• Enter all relevant income (salary, interest, rentals) and deduction details.
• Decide which tax regime minimizes your liability or best suits your financial goals.

How to Use the Income Tax Calculator (FY 2024-25, FY 2025-26)

1. Choose Financial Year (FY) and your age category (since old regime slabs differ by age).
2. Enter Salary Details: Basic salary, HRA (if any), LTA, and any exempt allowances (e.g., telephone reimbursements).
3. Other Income: Include interest, rental income, capital gains, etc.
4. Add Deductions (80C, 80D, 80TTA) if applicable, particularly if you are considering the old regime.
5. Compare your tax liability in both regimes to see which is advantageous.

How to Calculate Income Tax on Salary: Example

Income from all sources is aggregated—Salary, House Property, Capital Gains, Business/Profession, Other Sources. For salaried individuals:

vbnetCopyEditIncome from Salary = Basic Salary + HRA + Special Allowance + Transport Allowance + ...
Minus: Relevant Exemptions (HRA, LTA, etc.)
Minus: Standard Deduction (Rs. 50,000 under old regime; Rs. 75,000 under new regime as per Budget 2025)

Example Calculation (Neha’s Scenario)

• Basic Salary: Rs. 1,00,000/month
• HRA: Rs. 50,000/month
• Special Allowance: Rs. 21,000/month
• LTA: Rs. 20,000/year
• Rent Paid: Rs. 40,000/month (city: Delhi)

Under Old Regime

• HRA Exemption available (partially).
• Std Deduction: Rs. 50,000
• Deductions under 80C, 80D, 80TTA (PPF, ELSS, LIC, Medical Insurance, etc.).

Under New Regime

• HRA entirely taxable (no exemption).
• Std Deduction: Rs. 75,000
• Limited or no deductions (80C, 80D, etc.) except standard deduction.

Tax Outcome:

• Old Regime: Approx. Rs. 2,73,000 total tax
• New Regime: Approx. Rs. 2,83,504 total tax

Old vs. New Tax Regime: Slab Rates

Budget 2025: Key Update

• No income tax if total income ≤ Rs.12 lakhs (due to a rebate of Rs. 60,000).
• Modified slabs for FY 2025-26 (AY 2026-27):

Income Range	Tax Rate
Up to Rs. 4,00,000	NIL
Rs. 4,00,001 – 8,00,000	5%
Rs. 8,00,001 – 12,00,000	10%
Rs. 12,00,001 – 16,00,000	15%
Rs. 16,00,001 – 20,00,000	20%
Rs. 20,00,001 – 24,00,000	25%
Above Rs. 24,00,000	30%

Old Regime (for reference)

• Slabs differ by age (<60, 60-80, >80).
• Basic exemption for individuals <60 years: Rs. 2,50,000.

Surcharge and Education Cess

• Surcharge applies for incomes exceeding Rs. 50 lakh. Ranges from 10% to 37% (though 37% is reduced to 25% under the new regime).
• 4% Health & Education Cess applies to total tax plus surcharge.

Benefits of Using an Income Tax Calculator

1. Accuracy: Reduces human errors in manual tax calculations.
2. Speed: Delivers tax estimates instantly.
3. User-Friendly: Straightforward inputs for incomes and deductions.
4. Better Financial Planning: Knowing your tax liability early helps in allocating budget for tax-saving investments (e.g., ELSS, PPF).

Income Tax FAQs

1. How can I calculate my tax payable?
   • Use an online tax calculator to input your income and deduction details.
2. Does everyone have to file returns?
   • Individuals below the exemption limit are not mandated unless they want to claim a refund.
3. Does the income tax calculator account for TDS?
   • No, TDS is a separate computation. However, it shows your overall tax liability.
4. How to calculate surcharge or rebate?
   • The calculator automatically computes it if you input your total income.
5. How to calculate income tax on arrear salary?
   • Add the arrears to your salary income in the calculator.
6. What is the difference between old and new tax regimes?
   • Old regime: Higher rates, but numerous deductions/exemptions.
   • New regime: Lower rates, but minimal deductions.
7. Can I use the same Income Tax Calculator for multiple income sources?
   • Yes. Enter salary, interest, capital gains, etc. to get a combined tax figure.

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6. Illustration for IIT/NIT/University Faculty

In addition to standard pay levels, the 8th CPC Salary Calculator often includes an AGP (Academic Grade Pay) feature for faculty in IITs, NITs, IIMs, IISc, IISER, and Central Universities. For instance, AGP 12 might correspond to an Associate Professor/Professor level. By selecting AGP and relevant allowances (e.g., NPA for certain medical faculty), you can generate a tentative monthly salary figure.

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7. Disclaimers

1. Imaginative 8th CPC: The 8th Pay Commission is not yet officially formed or announced by the Government of India. All data provided here is tentative and for illustrative purposes only.
2. Varying State Policies: Different states might adopt custom modifications to the central pay scales.
3. Budget 2025 Income Tax: The new rebate and slab rates are based on the proposed announcements. Final changes could differ if amendments are introduced.
4. Consult Professionals: For significant financial decisions or large tax liabilities, consulting a certified tax professional or chartered accountant is advisable.

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8. Conclusion

The tentative 8th Pay Commission Salary Calculator offers a glimpse into potential salary structures, but remains unofficial. Meanwhile, the Budget 2025 tax updates present lower rates, higher rebates, and a chance for taxpayers to choose a method (old vs. new regime) that best fits their financial strategy. Whether you are a Central/State Government employee, IIT/NIT faculty, or a private-sector taxpayer, staying informed is key.

• For pay-scale clarity, monitor official government notifications on the 8th CPC.
• For income tax planning, leverage an online tax calculator, compare old and new regimes, and plan early for investments.

With careful planning and the right tools, you can maximize your financial well-being amidst evolving policies.