Finance Ministry Announces Final Cost Inflation Index for FY25 at 363: Key Updates for AY 2025-26

The Cost Inflation Index is a crucial tool for calculating long-term capital gains from the sale of immovable property, securities, and jewelry. It adjusts for inflation when taxpayers file their income tax returns (ITR) next year.

The Ministry of Finance has notified the final Cost Inflation Index (CII) for FY25 (Assessment Year 2025-26) at 363. On May 24, 2024, the ministry, through the Central Board of Direct Taxes (CBDT), issued Notification No. 44/2024-Income-Tax, detailing the CII for the financial year 2024-25. This notification was made under the powers granted by clause (v) of the Explanation to section 48 of the Income-tax Act, 1961, and introduces further amendments to the previous notification issued on June 5, 2017.

The notification will come into effect on April 1, 2025, and will apply to the assessment year 2025-26. The Cost Inflation index (CII) for FY 2023-24 was 348.