Global Partner. Integrated Solutions.
28 April 2026
Key Transfer Pricing Changes under the Income-Tax Act, 2025 (ITA, 2025)
 
Effective 1 April 2026

  At a Glance - What Has Changed
  • Subtle change in the meaning of Associated Enterprise (AE) u/s 162
  • Form 48 (erstwhile Form 3CEB) - Revamped
  • Master Filing (Form 56) - Additional Disclosure related to Intangibles
  • In case of an Advance Pricing Agreement (APA), now the affected AE can also file a modified return
  • Retrospective changes in timelines involving Transfer Pricing
  • From Penalties to Graded Fees
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Our Comments

Overall, the reforms represent a decisive shift toward a more coherent, streamlined, and taxpayer-centric transfer pricing regime, with a pronounced emphasis on minimizing ambiguity, curbing protracted litigation, and aligning India's framework with evolving global best practices. The move toward greater standardization, coupled with the expansion of Safe Harbour provisions and a more accessible and time-bound APA framework, reflects a conscious effort to balance administrative efficiency with robust regulatory oversight. Importantly, the calibrated focus on high-risk areas such as intangibles and financing transactions demonstrates responsiveness to the increasing complexity of cross-border value creation. Together with initiatives such as automation and block assessments, which aim to reduce repetitive compliance burdens and disputes, these measures are poised to enhance transparency, improve ease of doing business, and instil greater confidence among taxpayers. In sum, the reforms are likely to drive a more stable, predictable, and forward-looking transfer pricing environment that encourages voluntary compliance while safeguarding the tax base.
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