Circular No. 03 of 2026 issued by the Central Board of Direct Taxes prescribes the procedure for notification and compliance of Sovereign Wealth Funds (SWFs) under Schedule V of the Income-tax Act, 2025. The circular facilitates tax exemption benefits for specified income such as dividends, interest, and capital gains arising from investments in notified infrastructure sectors, subject to conditions like investment period (2020–2030) and minimum holding of three years. It introduces Form I for SWFs seeking notification and Form II for quarterly reporting of investments. Existing SWFs notified under earlier provisions are exempt from reapplying but must comply with reporting requirements. The circular mandates filing of returns, audit reports, and periodic disclosures to ensure transparency and monitoring. Effective from 1 April 2026, the framework strengthens compliance, standardizes procedures, and ensures that only eligible SWFs benefit from tax exemptions while promoting infrastructure investment in India.
F.No.370142/46/2025-TPL
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
(TPL Division)
Circular No. 03 of 2026 | Dated: 30th March, 2026
Sub: Notification of Sovereign Wealth Fund under Schedule V [Table: SI. No. 7.Note 5(a)(ii)(G)] of the Income-tax Act, 2025-reg.
Schedule V [Table: Sl. No. 7] of the Income-tax Act, 2025 (hereinafter referred to as the Act) inter alia provides for exemption to income of a specified person in the nature of dividend, interest, any sum referred to in section 92(2)(k) of the Act or long-term capital gains (whether or not such capital gains are deemed as short-term capital gains under section 76 of the Act) arising from investment made by it in India if the investment is made in specified infrastructure business (including business notified vide Notification F.No. 13/1/2025-IPP dated 19.09.2025, i.e. Infrastructure sub-sectors mentioned in Harmonised Master List) during the period from 01.04.2020 to 31.03.2030, and held for at least three years.
2. Specified person for this purpose inter alia includes notified sovereign wealth fund (SWF) which fulfils the conditions specified in Schedule [Table: SI. No. 7. Note 5(a)].
3. In order to facilitate the process of notification of the SWF, the Board, in exercise of powers conferred under section 239 of the Act, hereby specifies that the SWF shall file application in the Form I in the Annexure to this circular. The Form I shall be filed with the Member, Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, New Delhi having supervision and control over the work of Foreign Tax and Tax Research Division.
4. Further, the notified SWF shall be required to file return of income along with the audit report. It shall also be required to file a quarterly statement within one month from the end of the quarter electronically in Form II in respect of each investment made during the quarter in the Annexure to this circular.
5. The requirement of filing Form I and Form II by the SWF shall apply as follows:
5.1 Category I: SWF already notified under section 10(23FE) of the Income-tax Act, 1961
5.1.1 SWF which have already been notified under section 10(23FE) of the Income-tax Act, 1961 are not required to file fresh application in Form I as provided in para 3. However, such notified funds shall be required to file a quarterly statement within one month from the end of the quarter electronically in Form II as provided in para 4 in respect of each investment made during the quarter.
5.2 Category II: SWF seeking fresh notification under Schedule V [Table: SI. No. 7.Note 5(a)(ii)(G)] of the Act
5.2.1 SWF seeking fresh notification under Schedule V [Table: Sl. No. 7.Note 5(a)(ii)(G)] of the Act shall file application in the Form I as provided in para 3 and such notified funds shall be required to file a quarterly statement within one month from the end of the quarter electronically in Form II as provided in para 4 in respect of each investment made during the quarter.
6. The Director General of Income-tax (Systems) shall lay down the data structure, standards and procedure for furnishing and verification of the Form I and Form II and shall be responsible for formulating and implementing appropriate security, archival and retrieval policies in relation to the said forms so furnished.
7. This circular will be effective from 01.04.2026 and will apply for tax year 2026-27 and subsequent tax years.
Enclosure: Annexure
(Rohit Singh)
Under Secretary (TPL-I)
CBDT, New Delhi
Copy to the:
1. PS/OSD to FM/ PS/OSD to MoS(F).
2. PS to the Finance Secretary.
3. PS to the Revenue Secretary.
4. Chairman and Members, CBDT.
5. Joint Secretaries/ CsIT/Directors/Deputy Secretaries/Under Secretaries, CBDT.
6. C&AG of India (30 copies).
7. JS & Legal Advisor, Ministry of Law & Justice, New Delhi.
8. Institute of Chartered Accountants of India.
9. CIT (M&TP), Official Spokesperson of CBDT.
10. Principal DGIT (Systems) for uploading on the departmental website.
(Rohit Singh)
Under Secretary (TPL-I)
CBDT, New Delhi
Annexure
FORM I
Application for notification under Schedule V [Table: SI. No.7.Note 5(a)(ii)(G)]
(Sovereign Wealth Fund)
| Part A: Particulars of the Sovereign Wealth Fund (SWF) | ||||
| 1. | Name: | (refer Note 1) | ||
| 2. | Address: | (refer Note 2) | ||
| 3. | Communication Address in India: | (refer Note 3) | ||
| 4. | Permanent Account Number (PAN): | |||
| 5. | Tax Identification Number (TIN): | (refer Note 4) | ||
| 6. | Country of residence: | |||
| 7. | Set up under the law of (please mention the name of the foreign country) | |||
| 8. | E-mail Id: | |||
| 9. | Contact Number: | Country Code |
Number | |
| 10. | Other details to be provided as separate enclosure: | (attach as per Note 5) | ||
Part B: Certification
The applicant is a SWF and interested in making investment in terms of Schedule V [Table: Si. No. 7] and therefore, it is requested that necessary notification may kindly be issued. It is hereby certified that the SWF satisfies all the conditions mentioned in Schedule V [Table: Si. No. 7 and Sl. No.7.Note 5(a)(ii)]].
|
Verification _____________ , hereby affirm that the information provided in this application is true and correct to the best of my knowledge. I have not concealed any relevant fact. I am submitting this application in my capacity as (designation), holding PAN _________________________________ and I am competent to verify and submit this application. |
Place:
Date:
Name:
Signature:
Designation:
Notes:
1. The name shall include full name of the Sovereign Wealth Fund.
2. The address shall include flat/door/building, road/street/block/sector, area/locality, post office, town/city/district, state, country/region and pin code/zip code.
3. The communication address in India shall include flat/door/building, road/street/block/sector, area/locality, post office, town/city/district, state and pin code.
4. TIN of the Sovereign Wealth Fund in the country or specified territory of its residence and in case no such number is available, then a unique number on the basis of which it is identified by the Government of that country or the specified territory of which it claims to be a resident.
5. With respect to Part A(Si. No. 10), following details shall be provided as annexures, namely: —
| Annexure | Particulars |
| A-1 | Documents constituting the SWF and amendments (if any) |
| A-2 | Any other relevant information |
6. The application in this form is to be made to the Member (having supervision and control over the work of Foreign Tax and Tax Research Division), Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, New Delhi.
7. The form is to be signed by the person competent to verify the return of income under section 265.
8. Some of the information in the form would be pre-filled to the extent possible.
FORM II
Intimation by Sovereign Wealth Fund of investment under Schedule V ITable: SD. No. 71 (within one month from the end of the quarter ending on 30th Jane, 30th September, 31st December and 3P March of the financial year)
| Part A: Particulars of the Sovereign Wealth Fund (SWF) | ||||||||||
| Name: | (refer Note 1) | |||||||||
| Address: | (refer Note 2) | |||||||||
| Permanent Account Number (PAN): | ||||||||||
| E-mail Id: | ||||||||||
| Contact Number: | Country Code |
Number | ||||||||
| Part B: Other it etails | ||||||||||
| Notification Number: | ||||||||||
| Notification Date: | ||||||||||
| Financial Year: | ||||||||||
| Quarter Ending: | (refer Note 3) | |||||||||
| Part C: Particulars of Investment | ||||||||||
| Si. No. | Date of investment |
Amount | Nature of investment (refer Note4) |
Nature of income (refer Note 5) | Details of the entity in which Investment made |
|||||
| Nature of entity (refer Note 6) |
Name | PAN | ||||||||
| A | B | C | D | E | F | G | H | |||
| 1. | ||||||||||
| 2. | (Repeat, if required) | |||||||||
| Total | ||||||||||
–
| Verification
____________ , solemnly affirm that to the best of my knowledge and belief, the information provided in this form is correct and complete and particulars shown therein are truly stated. I further declare that I have not concealed any relevant fact or information. I also declare that I am making this intimation in my capacity as (designation) and that I am holding PAN and I am competent to verify and submit this intimation. |
Place:
Date:
Name:
Signature:
Designation:
Notes:
1. The name shall include full name of the Sovereign Wealth Fund.
2. The address shall include flat/door/building, road/street/block/sector, area/locality, post office, town/city/district, state, country/specified territory and pin code.
3. In Part B (SI. No. 9), fill with 30th June/ 30th September/ 31′ December/ 31st March.
4. In Part C (column D), one of the following codes is to be selected:
| Nature of Investment | Code |
| Debt | 1 |
| Equity | 2 |
| Preference Shares | 3 |
| Others (Please specify) | 4 |
5. In Part C (column E), one of the following codes is to be selected:
| Nature of Income | Code |
| Interest | 1 |
| Dividends | 2 |
| Capital Gains | 3 |
| Others (Please specify) | 4 |
6. In Part C (column , one of the following codes is to be selected:
| Nature of entity in which investment is made | Code |
| 1 | |
| Business Trust referred to in Schedule V [Table: SI. No. 7.D(a)(iii)(A)] | |
| Eligible Infrastructure Facility referred to in Schedule V [Table: Sl. No. 7.D(a)(iii)(B)] | 2 |
| Eligible Alternative Investment Fund referred to in Schedule V [Table: Sl. No. 7.D(a)(iii)(C)] | 3 |
| Eligible Domestic Company referred to in Schedule V [Table: Sl. No. 7.D(a)(iii)(D)] | 4 |
| Eligible Non-Banking Financial Company referred to in Schedule V [Table: Sl. No. 7.D(a)(iii)(E)] | 5 |
7. This form is to be applied to the Assessing Officer and is to be signed by the person competent to verify the return of income under section 265.
8. Some of the information in the form would be pre-filled to the extent possible.
9. The amount mentioned in this form is to be filled in rupees unless stated otherwise.
