CBDT mandates new disclosures for tax-free gains on govt securities

New Delhi: The Central Board of Direct Taxes (CBDT) has prescribed a disclosure requirement for taxpayers claiming exemptions on interest and capital gains from government securities under the Income-Tax Act, 2025.

The Income-tax (Seventh Amendment) Rules, 2026, inserted Rule 281A into the Income-tax Rules, 2026, requiring taxpayers claiming exemptions under Schedule IV in a notification issued on Monday.

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The newly inserted Form 173A seeks details of the taxpayer's name, country of residence, address, permanent account number (PAN), tax year, email address and contact number. It also requires the value of government securities held on April 1 and March 31, purchases during the tax year, sale proceeds, gross interest received or accrued, and capital gains earned.

Taxpayers must identify the securities by their International Securities Identification Number (ISIN), specify their type and tenor, and provide a declaration confirming the accuracy of the information submitted, the notification said.

The form covers treasury bills, fixed-rate bonds, floating-rate bonds, state development loans and other government securities.