The Central Board of Direct Taxes (CBDT) has notified the Cost Inflation Index (CII) for the Financial Year 2026-27 vide Notification No. 85/2026 dated 15th July, 2026, issued in exercise of the powers conferred by section 72(8)(a) of the Income-tax Act, 2025 (30 of 2025). The CII for the Financial Year 2026-27 has been fixed at 384.
The Cost Inflation Index is used for computing the indexed cost of acquisition and the indexed cost of improvement of a capital asset for the purpose of determining long-term capital gains chargeable to tax. Indexation adjusts the original cost of an asset for inflation over its holding period, so that only the real gain—and not the portion attributable to inflation—is brought to tax.
With the base year retained at 2001-02 (index = 100), the index of 384 for the Financial Year 2026-27 represents an increase over the index of 376 notified for the Financial Year 2025-26. The complete year-wise Cost Inflation Index, as notified, is set out in the Table below:
TABLE
| Sl. No. | Financial Year | Cost Inflation Index |
| (1) | (2) | (3) |
| 1 | 2001-02 | 100 |
| 2 | 2002-03 | 105 |
| 3 | 2003-04 | 109 |
| 4 | 2004-05 | 113 |
| 5 | 2005-06 | 117 |
| 6 | 2006-07 | 122 |
| 7 | 2007-08 | 129 |
| 8 | 2008-09 | 137 |
| 9 | 2009-10 | 148 |
| 10 | 2010-11 | 167 |
| 11 | 2011-12 | 184 |
| 12 | 2012-13 | 200 |
| 13 | 2013-14 | 220 |
| 14 | 2014-15 | 240 |
| 15 | 2015-16 | 254 |
| 16 | 2016-17 | 264 |
| 17 | 2017-18 | 272 |
| 18 | 2018-19 | 280 |
| 19. | 2019-20 | 289 |
| 20. | 2020-21 | 301 |
| 21. | 2021-2022 | 317 |
| 22. | 2022-23 | 331 |
| 23. | 2023-24 | 348 |
| 24. | 2024-25 | 363 |
| 25. | 2025-26 | 376 |
| 26. | 2026-27 | 384 |
This notification shall apply to the tax year 2026-27 on and from the 1st day of April, 2026 and subsequent tax years.
The Notification can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/07/CBDT-Notification-85-2026.pdf
