Income-tax Act, 1961Section 145
- Cash or mercantile system regularly followed
- ICDS notified under 145(2)
- Best judgment assessment if accounts unreliable
Applies to FY 2025-26 (AY 2026-27) and earlier years.
IT Act 1961 → 2025 / Section 145
Business incomeSection 145 → Section 276
Method of accounting and ICDS
Section 145 of the old Income-tax Act, 1961 · new section 276 under the Income-tax Act, 2025
New reference Section 276 (145A → 277)
Income-tax Act, 2025Section 276 (145A → 277)
- Same, now section 276
- ICDS under 276(2)
- Best judgment assessment under section 271
Applies from tax year 2026-27 (from 1 April 2026).
What changed
Renumbered.
Practice notes
- Valuation of inventory and interest income timing (old 145A, 145B) continue in section 277.
Frequently asked
What is section 145 called in the new Income Tax Act 2025?
Section 276 (method of accounting and ICDS).
What is section 145 called in the new Income-tax Act, 2025?
Section 145 of the Income-tax Act, 1961 corresponds to Section 276 (145A → 277) of the Income-tax Act, 2025, which applies from 1 April 2026 (tax year 2026-27).
What changed in section 145 under the new Income Tax Act?
Renumbered.
Is section 145 still applicable for FY 2025-26?
Yes. Income of FY 2025-26 (AY 2026-27) and earlier years is governed by section 145 of the 1961 Act. Section 276 (145A → 277) of the 2025 Act applies from tax year 2026-27.