Rule 100 mandates minimum profit margins of 4% and 2% for specified businesses to qualify for safe harbour, while restricting deductions and loss set-offs to ensure certainty and simplified taxation.
Rule 99 defines eligible assessees, businesses, goods, and gross receipts for safe harbour in income attribution cases, covering foreign diamond miners and electronics manufacturing through custom bonded warehouses.
CBIC has allowed Eligible Manufacturer Importers to avail deferred payment of customs duty from 1 April 2026. The circular outlines strict eligibility criteria and compliance safeguards to ensure faster clearance and improved trade facilitation.
Rule 98 introduces a structured filing, verification, and appeal mechanism with strict timelines, ensuring deemed acceptance of safe harbour for specified domestic transactions if authorities fail to act within prescribed periods.
Rule 97 allows automatic acceptance of transfer prices for specified domestic transactions where electricity tariffs are regulator-approved and milk pricing is quality-based and transparent, eliminating comparability adjustments.
Rules 92–96 exclude safe harbour benefits for transactions with entities in notified or low-tax jurisdictions and deny MAP where safe harbour is accepted, while introducing domestic safe harbour relief for electricity and dairy co-operative transactions.
Rule 91 provides a five-year safe harbour regime for eligible IT service transactions with electronic verification, time-bound acceptance, and structured compliance requirements. The provision ensures transfer pricing certainty while restricting re-entry after withdrawal.
Rule 90 prescribes a structured filing process, TPO review mechanism, and strict timelines, ensuring that the safe harbour option becomes automatically valid if authorities fail to act within the stipulated period.
Rule 89 of the Draft Income-tax Rules, 2026 prescribes fixed profit margins, interest spreads, and transaction limits for eligible international transactions to secure automatic acceptance of transfer prices, reducing litigation and compliance uncertainty.
Draft Rule 88 of the Income-tax Rules, 2026 clearly identifies the categories of international transactions that qualify for safe harbour, helping taxpayers determine eligibility and reduce transfer pricing disputes.
