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Tax Audit Deadline Looms: New Form 3CD Rules Demand Urgent Attention
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CNBC TV18•28-09-2026, 10:56
Tax Audit Deadline Looms: New Form 3CD Rules Demand Urgent Attention
- •The tax audit deadline for FY 2025-26 (AY 2026-27) is September 30, with new Form 3CD rules introducing greater reporting requirements.
- •Taxpayers must prepare for detailed reporting on MSME payments, including supplier Udyam status and payment dates, to comply with revised Clause 22 and Section 43B(h).
- •Clause 31 mandates comprehensive reporting of loans, deposits, and advances, requiring reconciliation of non-cash settlements and journal entries between group entities.
- •Expenditure related to regulatory settlements under Clause 21 must be carefully reviewed for tax deductibility, with finance and legal teams collaborating on documentation.
- •For share buybacks, Clause 36B requires reporting of the amount received and acquisition cost, necessitating retention of consideration statements and historic cost records.
Key Questions Answered
Taxpayers covered by a tax audit for FY 2025-26 have until September 30, 2026, to furnish their Form 3CA-3CD/3CB-3CD tax audit reports for Assessment Year 2026-27.
Revised Clause 22 requires auditors to report amounts payable to micro and small enterprises, non-deductible interest under Section 23 of the MSMED Act, and payments made within or beyond the prescribed period, with Section 43B(h) treatment reflected in Clause 26.
Clause 31 requires detailed reporting of loans, deposits, advances, and repayments by mode, meaning businesses must reconcile transactions like journal-entry settlements between group entities at the individual transaction level.
