Income-Tax Act 2025 Compliance Tracker (September–October 2026)
As India prepares for the phased transition to the Income-tax Act, 2025, the CBDT and the Directorate General of Income-tax (Systems) released a series of pivotal transition notifications throughout September and October 2026.
Here is your comprehensive executive summary of the changes affecting registered professionals, appellate proceedings, and high-value financial reporting.
1. Registered Valuers & Practitioners Extended to 31 March 2027 (Notification 120/2026)
On 17 September 2026, CBDT issued Notification No. 120/2026 (G.S.R. 822(E)), notifying the Income-tax (Fourth Amendment) Rules, 2026:
- Extension for Valuers & Tax Practitioners: Amends Rule 246(4) and Rule 256(4), extending the deadline for existing and new Registered Valuers and Authorized Income-Tax Practitioners (ITPs) to complete re-registration on the direct tax portal from 30 September 2026 to 31 March 2027.
- Decriminalisation in Tax Recovery: Amends Rule 225 to eliminate arrest and civil imprisonment as routine tax recovery measures, aligning direct tax collections with humane corporate governance standards.
2. JCIT(Appeals) Hierarchical Subordination (Notification 133/2026)
On 30 September 2026 (published 12 October 2026 in S.O. 5368(E)), CBDT updated Notification S.O. 359 under Section 238:
It clarifies that Joint Commissioners of Income-tax (Appeals) [JCIT(A)] and Additional Commissioners of Income-tax (Appeals) [Addl. CIT(A)] are administratively subordinate to the Principal Chief Commissioners / Chief Commissioners of Income-tax (Pr. CCIT / CCIT) in whose territorial jurisdiction they function. This eliminates ambiguity in administrative oversight and performance appraisals for faceless appeals.
3. High-Value Financial Reporting: First Half-Yearly Deadlines (31 Oct 2026)
Via DGIT(Systems) Notifications Nos. 1, 2, and 3 of 2026 (issued 10 September 2026), the department instituted half-yearly Statement of Financial Transactions (SFT) reporting:
- Notification No. 1/2026 (Form No. 98 & Form No. 97): Entities receiving non-PAN declarations under Form No. 97 for specified high-value transactions must electronically upload half-yearly statements in Form No. 98 by 31 October (for April–September) and 30 April (for October–March).
- Notification No. 2/2026 (SFT-2517 for Depositories): NSDL and CDSL must report capital gains on listed securities every six months using FIFO methodology and weighted-average cost of acquisition, enabling real-time pre-population of Annual Information Statements (AIS).
- Notification No. 3/2026 (SFT-2518 for Mutual Funds): RTAs (CAMS, KFintech) must submit half-yearly data on mutual fund redemptions, switches, and Systematic Withdrawal Plans (SWPs).
4. Summary of Transition Deadlines
| Statutory Regulation | Impacted Stakeholder | Key Compliance Obligation | Extended Deadline |
|---|---|---|---|
| Notification 120/2026 | Registered Valuers & ITPs | Direct tax portal registration under 2025 Act | 31 March 2027 |
| Systems Notif. 01/2026 | High-Value Reporting Entities | Half-yearly Form 98 statement of Form 97 declarations | 31 October 2026 |
| Systems Notif. 02/2026 | Depositories (NSDL/CDSL) | Half-yearly SFT-2517 listed share capital gains | 31 October 2026 |
| Systems Notif. 03/2026 | Mutual Fund RTAs | Half-yearly SFT-2518 mutual fund redemptions | 31 October 2026 |
5. Stay Ahead of Direct Tax Shifts With RegisterYourFirm
Managing modern tax compliance requires proactive advisory. At RegisterYourFirm.com, our tax consultants and chartered accountants assist companies, financial intermediaries, and high-net-worth individuals in navigating transition requirements under the Income-tax Act, 2025. Contact us today.