Catch-up
Regulatory Brief

CBDT notified the rules and Forms 1 to 4 for the Foreign Assets of Small Taxpayers Disclosure Scheme, 2026 (G.S.R. 732(E); the Scheme itself sits in Chapter IV, ss.130-144 of the Finance Act, 2026). The window opened 16 August 2026 and the declaration in Form 1 is due by 31 December 2026. Two categories: foreign assets never taxed, aggregate value up to Rs 1 crore, at 30% tax plus an additional amount equal to the tax, so 60% effective; and assets already taxed or from a non-resident source but simply unreported, up to Rs 5 crore, at a flat Rs 1 lakh. Value is taken at fair market value on 31 March 2026, and the test runs on asset value, not income. Read the immunity narrowly: it covers the Black Money (UFIA) Act, 2015 and nothing else - not FEMA, not PMLA, and not general prosecution under the Income-tax Act. Schedule FA reporting continues to apply from FY 2026-27 regardless.

The Department opened a nationwide verification exercise into suspicious outward foreign remittances, covering 394 entities and 36 professionals. It followed data analysis and ground intelligence on large overseas remittances by entities with little or no reported business activity, and Form 15CB certification is squarely in scope. This one lands on the profession, not only on clients. Pull your 15CB file and check, for each certificate, that the underlying documents, the purpose code and the treaty position on record actually support what was certified.

The Companies Compliance Facilitation Scheme window moves from 31 August to 15 September 2026 - its second extension, after General Circular 03/2026. Terms are unchanged: overdue forms (AOC-4, MGT-7/7A, ADT-1, FC-3, FC-4 and the like) at 10% of normal additional fees with immunity from prosecution for the covered defaults, plus the dormant-status (MSC-1) and strike-off (STK-2) concessions. Run a portfolio-wide ROC pendency scan now, particularly private companies carrying multi-year unfiled annual returns. Full additional fees, penalties and officer-disqualification exposure resume once 15 September passes.

The Multipurpose Empanelment Form for 2026-27 was hosted on meficai.org on 7 August and the last date extended from 29 August to 9 September 2026. ICAI has stated expressly that no further extension will be granted. MEF drives empanelment for bank branch audits and for RBI, NABARD and CRCS assignments, so a missed filing costs the firm a year of allotments. The operative date is 9 September 2026.

ICAI has issued the Guidance Note on Tax Audit under Section 44AB of the Income-tax Act, 1961 (Revised 2026) - 605 pages, Direct Taxes Committee - now live on the ICAI Publication Portal. It follows the exposure draft circulated on 9 July 2026 and supersedes the Revised 2025 edition. With tax audit reports for AY 2026-27 due 30 September, this is the edition your audit team should be working from, and the reporting positions in it should be settled before the file is signed rather than after. ICAI has not stamped a release date on the portal entry, so treat the edition label, not a date, as the identifier.

RBI brought the sunset of the temporary withdrawal of interest-rate ceilings forward from 30 September to 31 August 2026, for FCNR(B) deposits of 3 to 5 year tenors and NRE term deposits of 3 years and above [RBI/2026-27/243]. Deposits contracted from 1 September revert to ceiling-linked rates. Reset NRI clients' expectations on renewals and on any planned FCNR(B) or NRE placement - the elevated-rate window they may have been counting on is gone a month early.

The Income-tax (Third Amendment) Rules, 2026 (G.S.R. 656(E)) introduced Form ITR-BN, the return form for block assessments arising from search proceedings under s.247 or requisition under s.248 of the Income-tax Act, 2025, and amended Rule 332 by inserting Appendix IV. Effective from 1 April 2026. Any client under search or requisition now files the block return on ITR-BN - brief the assessment and litigation team.

The Income-tax (Second Amendment) Rules, 2026 (G.S.R. 646(E)) amended Rule 157(5)(c) to widen 'specified fund' to include Category I and Category II Alternative Investment Funds registered in India. No new form was introduced. Re-check the classification of Cat I and Cat II AIF clients, and any structuring that turns on the specified-fund route, against the amended rule.

CBDT issued a revised and consolidated Guidance Note with FAQs on FATCA and CRS reporting by Reporting Financial Institutions, aligned to the Income-tax Act, 2025 and the Income-tax Rules, 2026, and extended to Form 166 and to crypto-asset and CBDC reporting. Any client that is a Reporting Financial Institution must re-map its due-diligence and reporting workflow to the revised Note, including the new digital-asset categories, before the next reporting cycle.

MCA notified amendments to the Companies (Indian Accounting Standards) Rules, 2015. Confirm which standards are amended, and from what date, against the notification itself before settling accounting policies or the audit plan for FY 2026-27 for any Ind AS preparer on your books.

GSTN placed the proposed changes on hold until further notice - the mandatory capture of 'Ship To GSTIN' in Bill-To / Ship-To transactions, and the new voluntary e-Way Bill closure facility. Both had been scheduled to go live on 1 August 2026. Tell clients and their ERP or GSP teams to stand down on the cutover, but keep the ship-to GSTIN master clean-up running: the requirement is deferred, not withdrawn.

The Committee re-issued its flagship Background Material on GST in two volumes on 31 August 2026, and published a GST Sectoral Guide on Fast-Moving Consumer Goods on 11 August 2026. Worth noting the contrast: no CBIC notification, circular or instruction was issued in this entire window, yet the Institute's GST material moved twice. If your GST desk is still working from an older Background Material, replace it. Volume I ↗ · Volume II ↗ · FMCG guide ↗

The remaining utilities went live through August: ITR-5 online 5 August and offline 7 August; ITR-7 online 11 August and offline 14 August; ITR-6 online 18 August and offline 20 August. Firm, LLP, trust, institution and company returns can all now be prepared. Update to the latest build before filing, and re-verify the Schedule FA, exempt-income and audit-report linkage schedules.

The due date for non-audit returns carrying business or professional income (ITR-3, 4, 5 and 7) for AY 2026-27 was 31 August 2026. No extension order was issued - the Department instead ran a sustained filing push through August and reported over 6.5 crore returns filed as at 20 August. Clients who missed the date are into belated-return territory, with the fee under the belated-filing provision and the loss of carry-forward for most losses. Identify them now, not at the audit deadline.

MCA published a consolidated set of FAQs on the obligations of foreign companies and of Indian subsidiaries of foreign body corporates. Worth a pass for any inbound structure on your books - re-check the FC-1, FC-3 and FC-4 filing positions and the registered-place-of-business analysis against them.

The Council increased the permissible period for transfer of the goodwill of a deceased member's proprietary firm from one year to three years from the date of death, amending the Code of Ethics 2026, Volume I. This materially eases succession for sole proprietors. Where a proprietor died within the last three years and the firm name has not yet been transferred, the window may still be open - check before treating the name as lapsed.

RBI withdrew two long-standing reporting requirements for AD Category-I banks on non-resident bank Vostro accounts: the annual 15 January submission of an updated list of bank offices and branches, and the reporting of overdrawals [RBI/2026-27/251]. Compliance relief at the bank end, with no direct client action - note it only if you advise an authorised dealer on FEMA reporting.

CBDT enabled taxpayers to view their Foreign Asset Information through the Annual Information Statement. This landed on 20 July, the closing day of the last published issue, so it is carried into this one. Read it with ITEM 01 and ITEM 02: the department is surfacing foreign-asset data to the taxpayer, opening a disclosure window, and running a remittance verification drive at the same time. Use it as a working tool - have clients pull the AIS foreign-asset view and reconcile it against Schedule FA before deciding whether a declaration under the Scheme is needed.

Under the Income-tax Act, 2025 the quarterly TDS and TCS statements were renumbered for Tax Year 2026-27 onwards: Form 138 replaces 24Q (salary), Form 140 replaces 26Q (non-salary resident), Form 144 replaces 27Q (payments to non-residents) and Form 143 replaces 27EQ (TCS). The correction track for these forms is now published and validates through FVU version 1.2. Corrections for FY 2010-11 to FY 2025-26 continue on the separate FVU 9.5 line, so the two eras do not mix. One gap to plan around: the Q4 file format for Form 138 is still awaited.

The balance of CBDT notifications in the window (92 to 117 of 2026, other than 94, 97 and 114) are entity-specific exemptions and approvals - District Legal Service Authorities, the Kerala Headload Workers Welfare Board, Noida SEZ Authority, Sir Ganga Ram Trust, and the Maharashtra Electricity Regulatory Commission (Notifications 116 and 117 of 25 August). No general applicability; check the conditions in the notification before relying on any approval. No CBDT circular was issued in the window at all. On the quiet side: GST saw no legislative change reaching our clients beyond the 29 July advisory, and no SEBI circular met the audit or corporate-compliance scope - the in-window circulars were entirely capital-markets and operational.