Payroll · 18 Aug 2026
The new tax regime: a payroll checklist for 2026
What changes in TDS projection when most of your team is on the new regime, and the five checks to run before your next payroll.
By Kreattle Compliance Team
Most salaried employees now default to the new tax regime, which changes how TDS is projected each month. The standard deduction is higher, most exemptions no longer apply, and the section 87A rebate covers a much larger band of income.
Five checks before you run payroll
- Confirm each employee’s chosen regime for the year - a change mid-year only takes effect from that month.
- Make sure the standard deduction and rebate limits in your rate tables match the current Finance Act.
- Remove HRA and 80C amounts from the projection for new-regime employees.
- Check marginal relief for people just above the rebate threshold.
- Re-run the projection after any mid-year salary revision.
Kreattle keeps every slab and limit in an effective-dated table, so each month’s projection uses the rules in force that month. Always have your CA verify the tables before go-live.