Section 23 → Section 26
Determination of Annual Value
Quick Answer
Section 23 of the Income Tax Act, 1961 (Determination of Annual Value) corresponds to Section 26 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 23
The starting point is Section 23 of the Income Tax Act, 1961 — determination of annual value. Rules for calculating Gross Annual Value (GAV) based on municipal value, fair rent, standard rent, or actual rent received.
From 1st April 2026, the same subject sits at Section 26 of the Income-tax Act, 2025 — retained and renumbered as Section 26 of the Income-tax Act, 2025. Retained. The concept of 'Deemed to be let out' for holding more than two self-occupied properties is strictly enforced via PAN tracking.
For Section 23, the practical impact is rated Medium. Automates property tax calculations.
Sec 23
Provision Summary
Rules for calculating Gross Annual Value (GAV) based on municipal value, fair rent, standard rent, or actual rent received.
Sec 26
Provision Summary
Retained. The concept of 'Deemed to be let out' for holding more than two self-occupied properties is strictly enforced via PAN tracking.
Key Changes & Highlights
- Municipal value data linked directly via local government APIs for automated GAV calculation in ITR.
Related Articles from the Tax Academy
corporate compliance
Mastering the 45-Day MSME Payment Rule: A 2025-26 Compliance Guide
A detailed guide for corporations on navigating Section 43B(h) of the Income Tax Act. Learn how to avoid tax disallowance on MSME payments using TallyPrime.
corporate compliance
Form 3CD Changes for MSME Dues: A 2026 Compliance Guide
A detailed professional guide for corporate compliance regarding the changes in Form 3CD for MSME dues and the transition from the Income Tax Act 1961 to the Income-tax Act, 2025.
Frequently Asked Questions
What is Section 23 of the Income Tax Act, 1961 about?
Section 23 of the Income Tax Act, 1961 covers determination of annual value. Rules for calculating Gross Annual Value (GAV) based on municipal value, fair rent, standard rent, or actual rent received.
Which section replaces Section 23 in the Income-tax Act, 2025?
Section 23 of the Income Tax Act, 1961 maps to Section 26 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. The concept of 'Deemed to be let out' for holding more than two self-occupied properties is strictly enforced via PAN tracking.
What is the impact of the change to Section 23 under the new tax code?
The transition impact for Section 23 is rated Medium. Automates property tax calculations.
What should I watch out for when Section 23 moves to the 2025 code?
Municipal value data linked directly via local government APIs for automated GAV calculation in ITR. These points are specific to Section 23 (Determination of Annual Value).
Disclaimer: This mapping of Section 23 (Determination of Annual Value) to Section 26 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 23 is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
Need professional help on Section 23?
Compare trusted providers — both offer CA services ready for the Income-tax Act, 2025.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?