Form No. 26 is the prescribed tax audit report under section 63 of the Income-tax Act, 2025, replacing earlier Forms 3CA/3CB/3CD from tax year 2026-27. It applies to businesses and professionals exceeding prescribed thresholds or falling under specific presumptive taxation conditions. The form introduces a structured, technology-driven reporting framework with Parts A to D, combining factual disclosures and audit opinions. A key shift is the use of Yes/No-based triggers and schedule-based reporting, ensuring proportionate compliance and reducing unnecessary disclosures. Mandatory reporting of digital infrastructure such as accounting software, cloud storage, and server location enhances transparency and curbs tax evasion. The form aligns closely with ITR data to reduce mismatches, litigation, and discretionary adjustments. Auditor responsibilities are standardized with classification of observations and disclosure of their financial impact. Overall, Form 26 promotes accuracy, consistency, and risk-based assessment, improving compliance efficiency while reducing ambiguity and administrative burden.
Income Tax Department
Ministry of Finance, Government of India
FAQs on Income Tax Form 26 – Audit report and Statement of particulars required to be furnished under section 63 of Income Tax Act, 2025
Audit Report and Statement of particulars required to be furnished under section 63 read with Rule 47
| Name of Form as per I.T. Rules, 1962 | Form 3CA, 3CB, 3CD | Name of Form as per I.T. Rules, 2026 | Form No. 26 |
| Corresponding Section of I.T.Act, 1961 | 44AB | Corresponding section of I.T.Act, 2025 | 63 |
| Corresponding Rule of I.T. Rules, 1962 | Rule 6G | Corresponding Rules of I.T. Rules, 2026 | Rule 47 |
FAQ 1. What is Form No. 26?
Ans: Form No. 26 is the prescribed Report of Audit of Accounts and Statement of Particulars required to be furnished under Section 63 of the Income-tax Act, 2025, in accordance with Rule 47 of the Income-tax Rules, 2026.
FAQ 2. From which tax year is Form No. 26 applicable?
Ans: Form No. 26 is applicable for tax years commencing on or after 1st April, 2026.
FAQ 3. Who is required to furnish Form No. 26?
Ans: Form No. 26 is required to be furnished by a person carrying on business or profession whose accounts are required to be audited under Section 63 of the Income-tax Act, 2025. This includes:
a. Business cases where total sales, turnover or gross receipts exceed ₹1 crore (threshold increases to ₹10 crore where cash receipts and cash payments each do not exceed 5% of total receipts and payments respectively);
b. Profession cases where gross receipts exceed ₹50 lakh;
c. Presumptive taxation cases under sections 58(2) or 61(2) (Table: Sl. Nos. 4 and 5) where income declared is lower than the deemed income.
d. Presumptive Taxation cases: When a taxpayer opts out of a presumptive scheme in any of the five consecutive years (the “lock-in period”), and their income exceeds the basic exemption limit.
FAQ 4. Is furnishing of Form No. 26 compulsory?
Ans: Yes. Furnishing of Form No. 26 is mandatory for all persons carrying on business or profession who fulfil the conditions specified in Section 63 of the Income- tax Act, 2025.
FAQ 5. What is the due date for furnishing Form No. 26?
Ans: Form No. 26 is required to be furnished annually, by the specified date, which is one month prior to the due date for furnishing the return of income under Section 263(1) of the Income-tax Act, 2025. Accordingly, where due date for furnishing return of income under section 263(1) is 31 October / 30 November, Form No. 26 shall be filed on or before 30 September / 31 October respectively.
FAQ 6. Whether Forms 3CA and 3CB (including Annexure in Form 3CD) prescribed under the Income-tax Act, 1961 continue to apply?
Ans: Forms 3CA, 3CB and 3CD continue for tax audits for previous years relevant to assessment years up to 2026-27. However, from tax year 2026-27, tax audit has to be furnished in Form No. 26.
FAQ 7. Whether section references in Form No. 26 correspond to the Income- tax Act, 1961?
Ans: No. All references in Form No. 26 correspond exclusively to the Income-tax Act, 2025 and the Income-tax Rules, 2026.
FAQ 8. What is the structure of Form No. 26?
Ans: Form No. 26 consists of the following parts:
- Part A – Particulars of the Assessee
- Part B – Statement of Particulars required under Section 63
- Part C – Audit Report where accounts are audited under any other law (corresponding to erstwhile Form 3CA)
- Part D – Audit Report where accounts are not audited under any other law (corresponding to erstwhile Form 3CB)
FAQ 9. When is Part C of Form No. 26 applicable?
Ans: Part C of Form No. 26 is applicable where the assessee’s accounts have been audited under any other law. In such cases, the tax auditor relies on the statutory audit and reports the particulars required under Section 63.
FAQ 10. When is Part D of Form No. 26 applicable?
Ans: Part D of Form No. 26 is applicable where the assessee’s accounts are not audited under any other law. An Accountant as defined under Section 515(3)(b) conducts the audit specifically for the purposes of Section 63.
FAQ 11. Who is authorised to sign Form No. 26?
Ans: Form No. 26 must be signed by an Accountant as defined under Section 515(3)(b) of the Income-tax Act, 2025.
FAQ 12. Is UDIN mandatory for Form No. 26?
Ans: Yes. UDIN (Unique Document Identification Number) is mandatory and must be generated by the signing Accountant and quoted in Form No. 26.
FAQ 13. Whether FRN is required to be mentioned in Form No. 26?
Ans: Yes. Where the audit is conducted in the name of a firm, the Firm Registration Number (FRN) is required to be mentioned.
FAQ 14. What is the process flow of filing Form No. 26?
Ans: The process is as follows:
1. The assessee engages an Accountant as defined under Section 515(3)(b).
2. The Accountant fills Form No. 26 on the e-filing portal with Membership Number and FRN, where applicable.
3. UDIN is generated and quoted.
4. The form is digitally signed using the Accountant’s DSC and uploaded.
5. The assessee electronically accepts Form No. 26 to complete filing.
FAQ 15. What are Schedules to Form No. 26 and when are they required?
Ans: Schedules are detailed annexures supporting disclosures in Part B. Form No. 26 follows a trigger-based approach, whereby schedules are required only when the corresponding clause is answered “Yes”, ensuring proportionate compliance.
- Common schedules include General Information, Accounting Information, Computation of Receipt/Income, Computation of Expenses, Prior Period, Losses/Depreciation/Deductions, International Taxation, TDS/TCS, GST, Quantitative Details, and Other Key Parameters
Schedules are only required when applicable, reducing compliance burden. This approach ensures proportionate compliance – detailed reporting only when necessary.
FAQ 16. Whether schedules referred to in Part B form part of the audit report? Ans: Yes. All schedules referred to in Part B form an integral part of the audit report and must be duly verified by the auditor.
FAQ 17. Whether reporting is required even where the answer to a clause is “No”?
Ans: Yes. Each clause in Part B requires a mandatory Yes/No response to ensure completeness and uniformity.
FAQ 18. Whether disclosure of accounting software and electronic storage is mandatory?
Ans: Yes. Under Rule 46, where the books of account or other documents are maintained electronically, they shall mandatorily remain accessible in India at all times, and a daily backup shall be maintained in India-located servers. In consonance with this Rule, Form No. 26 requires the IP address and country of location of server on which such accounting information is maintained, as well as the address of the India-located backup server to be furnished by the auditor.
FAQ 19. Whether journal entries are covered while reporting loans, deposits or specified sums?
Ans: Yes. Reporting covers all modes including journal entries, conversion of assets or liabilities and other non-cash modes, using prescribed mode codes.
FAQ 20. Whether reporting of indirect taxes such as GST is mandatory?
Ans: Where the assessee is liable to indirect taxes such as GST, excise duty or customs duty, the prescribed particulars must be furnished. The scope of indirect tax reporting has been rationalised compared to earlier forms. Details of total expenditure now no longer need be reconciled with the various entries of expenditure under GST reporting.
FAQ 21. Whether international taxation reporting is restricted only to transfer pricing cases?
Ans: No. Reporting is required in respect of secondary adjustments, interest limitation provisions, remittances reported in Form No. 145 (erstwhile Form 15CA) and other applicable international tax provisions.
FAQ 22. What is the objective of introducing clause-wise schedules in Part B? Ans: Clause-wise schedules ensure standardised disclosures, reduction of subjective narration, technology-driven risk assessment and consistency between audit reporting and return of income.
FAQ 23. How does Form No. 26 benefit compliant taxpayers?
Ans: Form No. 26 reduces interpretational ambiguity, limits discretionary adjustments and enables faster, data-backed assessments, thereby lowering litigation risk.
FAQ 24. Does Form No. 26 increase compliance burden?
Ans: While initial familiarisation is required, Form No. 26 avoids repetitive information requests, improves audit-return alignment and reduces future compliance friction.
Overall compliance cost is expected to reduce over time.
FAQ 25. How does Yes/No based reporting with schedules protect taxpayers? Ans: This approach ensures completeness, enables automated validation and reduces subjective interpretation, enhancing certainty and transparency.
FAQ 26. Whether Clause 36 relating to depreciation and brought forward losses has undergone any change?
Ans: Clause 36 corresponds to Clause 18 of the erstwhile Form 3CD. A material change relates to explicit segregation between assets used for less than 180 days and 180 days or more without requirement of specific dates. This would lead to substantial reduction in compliance burden.
FAQ 27. Whether Clause 43 relating to Form 15CA remittances represents a change?
Ans: Yes. Clause 43 is restricted to remittances actually reported in Part-D of Form No. 145 during the tax year and is integrated into international taxation reporting, thereby narrowing scope and avoiding duplication.
FAQ 28. Whether Clause 53 relating to quantitative details has changed?
Ans: Yes. Clause 53 introduces a structural change. Quantitative reporting is required only where the assessee has a trading unit or manufacturing concern and is furnished through a dedicated schedule segregating raw materials, finished goods, by-products and scrap.
FAQ 29. Why has Part B been segregated into General Information and clause- wise schedules?
Ans: To ensure clear identification of core business information, standardised reporting, reduction in narrative disclosures and alignment with automated assessment systems.
FAQ 30. Whether Part B replaces narrative disclosures under erstwhile Form 3CD?
Ans: Yes. Information earlier scattered across clauses has been consolidated into Part B – General Information.
FAQ 31. What is the objective of separating Part B from Part C / Part D?
Ans: To clearly distinguish factual disclosures from audit opinion, reduce overlap and enhance accountability.
FAQ 32. Whether Part B applies irrespective of Part C or Part D?
Ans: Yes. Part B applies uniformly in all cases.
FAQ 33. Why are Yes/No responses mandatory in Part B?
Ans: To ensure completeness, enable automated validation and reduce subjective interpretation.
FAQ 34. Whether schedule-based reporting increases compliance burden?
Ans: No. It is trigger-based and proportionate.
FAQ 35. What are the changes in the certification by the auditor regarding
various observations/qualifications on the audit report (Parts C and D of Form No. 26)?
Ans: The audit observations/qualifications (if any) by auditors will have to be mandatorily categorised clause-wise into one of the following three categories:
- Test-check basis, applying the principle of materiality
- Based on management representation
- Unable to verify
This will help the Department in analysing the audit observations/qualifications in an automated/standardized way, and will help in deciding the remedial course of action, including selecting the cases for further scrutiny.
FAQ 36. What is the reporting requirement in paragraph 3 of Parts C and D of Form No. 26?
Ans. The auditor will now be required to provide the impact (if any) on the profit/loss/book profit of any observations, qualifications, adverse remarks, disclaimers, or emphasis of matters, in the statutory audit. This will enable the department to ensure that statutory audit findings are also incorporated into the computation of income, if so required.
FAQ 37. What would be the alignment between the return of income and Form No. 26?
Ans. An endeavour has been made to align the data required in Form No. 26 with that in the ITR Form, so that, going forward, the taxpayer/department can populate the data provided in Form No. 26 in the ITR. This would also reduce mismatches between the ITR and Form No. 26 which could potentially trigger adjustments under section 270(1), consequently also reducing rectifications, appeals, grievances, etc.
FAQ 38. What is the new reporting requirement regarding statement of tax deducted or tax collected?
Ans. The auditor will have to provide the total number of transactions reported and those not reported in the TDS/TCS return, as it stands after the latest correction statement. Further, the total amount in relation to transactions not reported in the TDS/TCS return, will also have to be furnished.
Guidance Note on Income Tax Form 26 – Audit report and Statement of particulars required to be furnished under section 63 of Income Tax Act, 2025
Form No. 26 is the prescribed Audit Report and Statement of Particulars under Section 63 of the Income-tax Act, 2025 read with Rule 47 of the Income-tax Rules, 2026, consisting of Parts A to D, which cover the statement of particulars and audit-related information for assessees whose accounts are audited or not audited under any other law.
Parts A & B of Form No. 26 [corresponding to erstwhile Form 3CD] — Statement of Particulars Required to Be Furnished under Section 63
Part C of Form No. 26 [corresponding to erstwhile Form 3CA] [e-Form] — As prescribed under Rule 47, the audit report under Section 63 for Assessees Whose Accounts Are Audited Under Any Other Law
Part D of Form No. 26 [corresponding to erstwhile Form 3CB] [e-Form] — As prescribed under Rule 47, the audit report under Section 63 where Assessee’s Accounts Are Not Audited Under Any Other Law
Purpose of Part C of Form No. 26
Part C of Form No. 26 is applicable where the assessee’s books of account have already been audited under any other statute. The primary purpose of this Part C is to link the statutory audit conducted under another law with the tax audit under section 63 of the Income-tax Act, 2025 enabling the tax auditor to place reliance on the audited financial statements prepared in accordance with the applicable statute and to confirm that such accounts have been duly examined.
Purpose of Part C of Form No. 26 Ensures That
- An audit has been conducted under another law, and the same audited books of account form the basis of the tax audit.
- The statutory audit report is annexed to Form No. 26 where applicable and forms an integral part of the tax audit documentation.
- Audit observations, qualifications, adverse remarks, disclaimers or emphasis of matters, if any, shall be reported clause-wise and mandatorily categorised as (i) test-check basis, (ii) based on management representation, or (iii) unable to verify. The auditor shall report the impact, if any, on the profit/loss or book profit arising from such observations.
- The tax auditor verifies and reports all tax-specific particulars in Parts A & B along with schedules which are to be read together with Part C of the Form.
Purpose of Part D of Form No. 26
Part D of Form No. 26 is applicable where the assessee’s accounts are not required to be audited under any other law. The auditor conducts an audit specifically for the purposes of section 63 and expresses an opinion on the financial statements whether the financial statements give a true and fair view.
Part D of Form No. 26 Ensures That
- The tax auditor examines the books of account and financial statements in accordance with the provisions of the Income-tax Act, 2025.
- The auditor expresses an opinion on the Profit & Loss Account / Income & Expenditure Account and Balance Sheet.
- The tax auditor verifies and reports all tax-specific particulars in Parts A & B along with schedules which are to be read together with Part D of the Form
Parts A & B of Form No. 26 constitute the substantive factual disclosure component of the tax audit. They contain quantitative and qualitative particulars required for computing taxable income and facilitating computation and compliance verification with the Income-tax Act, 2025. It includes detailed reporting on subpart:
i. General Information
ii. Particulars of Books of Account and Method of Accounting
iii. Particulars of Receipt / Income
iv. Particulars of Expenses
v. Particulars of Prior Period Items
vi. Particulars of Losses, Depreciation and Deductions
vii. International Taxation
viii. Other Key Parameters
ix. Particulars of TDS / TCS
x. Particulars of Indirect Taxation
xi. Quantitative Details
Who Should File Form No. 26
The requirement to furnish Form No. 26 [corresponding to erstwhile Forms 3CA/3CB read with 3CD] is applicable when a business entity or professional meets the specified limits or conditions that make a tax audit mandatory under section 63 of the Income-tax Act, 2025.
For Businesses
A tax audit is required if the total sales, turnover, or gross receipts of the business exceed:
- Rs. 1 crore during the tax year; or
- Rs. 10 crore in the tax year, provided that
- cash receipts do not exceed 5% of the total receipts and payments, respectively
- cash payments do not exceed 5% of the total payments
For Professions
A tax audit is required if the gross receipts from the profession exceed X50 lakh during the tax year.
Under Presumptive Taxation Schemes
Form No. 26 is required for taxpayers who is eligible to opt for a presumptive taxation scheme but do not meet the specified conditions:
- Section 58(2) or 61(2) (Table: SI. Nos 4 and 5): If a person who is eligible to opt for the presumptive taxation scheme but claims the profits or gains for such business or profession to be lower than the profit and gains computed as per the presumptive taxation scheme, the requirement to file Form No. 26 becomes applicable .
Opting out of Presumptive Taxation as per section 58(2) (Table: SI No.1):
If a taxpayer opts out of the presumptive scheme in any of the five consecutive years (the “lock-in period”), they are not eligible for presumptive tax for next 5 years. Further, during such period, the taxpayer shall be required to furnish Form No. 26 under section 63, if the total income exceeds the basic exemption limit.
Frequency & Due Dates:
Form No. 26 is required to be furnished within the time prescribed under the Act, generally one month prior to the due date prescribed under Section 263(1), unless extended by the Board.
Structure of Form No. 26:
Form No. 26 is divided into the following Parts under the new framework
Part A — Particulars of the Assessee
This Part contains the basic particulars of the assessee, including name, address, PAN, status, tax year, residential status, and contact details.
Part B — Statement of Particulars under Section 63
This Part contains the detailed statement of particulars and disclosures required to be furnished under section 63, covering general information, books of account, method of accounting, income and receipts, expenses and disallowances, prior period items, losses, depreciation and deductions, international taxation, TDS/TCS, indirect taxation, quantitative details, and other key statutory parameters.
Part C — Audit Report under Section 63 (where accounts are audited under any other law). This Part is applicable where the accounts of the assessee have been audited under any other law and contains particulars relating to such statutory audit and is read together with Parts A and B.
Part D — Audit Report under Section 63 (where accounts are not audited under any other law)
This Part is applicable in cases where the accounts of the assessee have not been audited under any other law and contains the audit-related particulars, including observations and qualifications, if any, read with Parts A and B of the Form
Following documents may be required to file the Form No. 26
1. Books of account and relevant financial statements of the assessee (Balance Sheet, Profit & Loss Account / Income & Expenditure Account and Notes to Accounts).
2. Audit report and audited financial statements, where the accounts are audited under any other law.
3. Supporting documents and workings for particulars and disclosures required under Part A & B of Form No. 26.
4. TDS/TCS and indirect tax (GST) records, returns, challans and reconciliations, as applicable.
5. Quantitative and inventory records for trading, manufacturing, raw materials, finished goods, by-products and scrap, wherever applicable.
What is the process flow of filing Form No. 26?
The process flow includes following steps
1. Audit by Accountant under any other law or under section 63
2. Preparation of Part A & B to Form No. 26
3. Furnishing of Form No. 26 online by Chartered Accountant (e-form)
4. E-verification of Form via DSC of auditor
5. Acceptance of Form by taxpayer
Outcome of Processed Form No. 26:
1. Various fields of the tax audit report are validated against the ITR of the taxpayer. Discrepancies, if any, are brought to the notice of the taxpayer for revision.
2. If required, system-driven discrepancies may trigger system-driven action where applicable under the provisions of the Act, as applicable, e.g. Adjustment u/s 270(1)(a)
Common Changes Made Across Forms:
1. To enhance system compatibility and facilitate e-filing, fields such as Name, Designation, Address, PAN, have been separated into individual boxes to address earlier grouping issues.
2. References to Assessment/Financial/Previous Year(s) have been updated to “Tax Year(s)” throughout the Form and its Annexures.
3. Sections, Clauses, and Schedules have been revised in accordance with the provisions of the Income-tax Act, 2025.
4. The currency symbol “Rs.” has been replaced with “V’ for standardization.
5. Uniform adoption of Yes / No response format across the form.
6. Mandatory schedule-based reporting wherever the response is “Yes”
7. Increased use of tabular and structured disclosures instead of narrative reporting
8. Separate identification of items chargeable to tax but not credited/debited to the profit and loss account
9. Consolidation of repetitive disclosures into common schedules referenced throughout the form
10. Standardisation of language, formats and response patterns across all parts of the form
TABLE 1: Overall Objective of the Form No. 26
| Aspect | Earlier Form | New Modified Form | Benefit / Outcome |
| Compliance approach | Narrative, auditor- driven |
Structured, system- driven | Designed to significantly reduce interpretational disputes |
| Legal alignment | IT Act, 1961 | IT Act, 2025 | Future-ready compliance |
| Reporting style | Mixed narrative & tables | Drop-downs, Yes/No, schedules |
Faster and uniform reporting |
TABLE 2: Benefits to Users (Taxpayers & Auditors)
| Area | New Provision | User Benefit |
| Structured disclosures | Yes/No based triggers | Reduced ambiguity, fewer reporting errors |
| Section-wise mapping | Each clause mapped to IT Act, 2025 | Legal certainty and easier statutory correlation |
| Schedule-based reporting |
Detailed info only if applicable | Proportionate compliance and reduced reporting burden |
| Depreciation | Classification based on usage period (more than 180 days / 180 days or less) instead of asset-wise date of put to use | Simplified reporting, reduced asset- level tracking, and lower compliance effort for auditors |
| GST | Limited and focused GST break-up instead of exhaustive transaction-wise or tax- component-wise disclosures | Significant reduction in compliance burden and time spent on GST reconciliation |
| Employees’ State Insurance (ESI) | Reporting restricted to disallowable amounts only, instead of detailed employee-wise or month-wise data | Focused compliance, reduced data collation, and clarity on tax impact |
| E-Form validation | Built-in checks | Fewer defective filings and reduced revision requirements |
TABLE 3: How the New Form Curbs Tax Evasion
| Risk Area | New Disclosure Requirement | How Evasion is Curbed |
| Digital data | Accounting software, cloud, IP address | Mitigates risk of post-facto data tampering |
| Offshore data | Country of data storage | Mitigates concealment via foreign servers |
| Prior period items | Separate reporting | Prevents timing arbitrage |
| Foreign Remittance reported in Part-D of Form 15CA during the tax year |
Nature of remittance, taxable / non-taxable, | Prevents treaty misuse and revenue leakage through incorrect classification or non-deduction TDS |
| Mat Credit details | Year-wise MAT credit entitlement, utilization, and carry forward | Prevents excess credit claims, duplicate utilisation, and carry- forward manipulation |
TABLE 4: Technology & Data-Driven Advantages
| Feature | Earlier Position | New Position | Impact |
| Accounting software | Not required | Mandatory disclosure | Data authenticity |
| Cloud storage Not reported IP & country mandatory Traceability | |||
| Backup server | Not required | India-located backup server | Data security |
| Automation | Limited | High | Faster processing |
| Cross-matching | Manual | System-based | Early detection of mismatch |
TABLE 5: User-Friendliness Improvements
| Parameter | Earlier Form | New Modified Form | User Advantage |
| Form structure | Linear & bulky | Modular (Parts A—K) | Easy navigation |
| Language | Technical narrative | Simplified confirmations | Better understanding |
| Irrelevant clauses | Mandatory | Trigger-based | Less compliance burden |
| Data entry | Repetitive | Auto-linked schedules Time saving | |
TABLE 6: Alignment with Risk-Based Assessment
| Aspect | Earlier System | New System | Result |
| Department resources | Spread thin | Targeted | Efficient administration |
| Litigation | High | Likely reduction in litigation | Improved certainty & trust |
TABLE 7: Stakeholder-Wise Impact Summary
| Stakeholder | Impact |
| Taxpayers | Simplified compliance, fewer notices |
| Auditors | Structured responsibility, reduced ambiguity |
| Tax administration | Better data analytics, targeted scrutiny |
| Economy | Higher voluntary compliance |
| Judiciary | Reduced interpretational disputes |
TABLE 8: One-Line Presentation Summary (Ready to Use)
| Theme | Key Message |
| User benefit | Less narrative, more certainty |
| Anti-evasion Traceable data, targeted scrutiny | |
| User-friendliness | Compliance only when relevant |
| System reform | Risk-based, technology-driven taxation |
