Alert for CXOs and Directors: Acting as authorised signatory for a foreign company now requires PAN, address & more details under Income Tax Rules, 2026

Typically when a foreign company starts operating in India, it recruits certain employees as its key managerial personnel and one of these key personnel becomes its authorised signatory in India. Generally directors or CEO or other C suite employees become such authorised signatories. Now under the Income Tax Rules, 2026, there is an additional compliance requirement for such employees who are authorised signatories of foreign companies.

Keep reading to learn more about the details and how to navigate this situation so that you don't get into any trouble.

What has changed for Indian individuals acting as authorised signatories for foreign companies?

Foreign entities need a PAN to do business in India. Chartered Accountant Suresh Surana says that as per the new Income-tax Act, 2025 and Income-tax Rules, 2026, foreign entities applying for a Permanent Account Number (PAN) must use the newly introduced Form No. 96 (which replaces the old Form 49AA).


In this new Form 96, Surana says a major compliance change is that it is now mandatory for the foreign entity to provide the details of a Representative Assessee or an Authorised Representative having an Indian address in Part D of the Form 96 (this is exempted only for Foreign Portfolio Investors)

Surana says that the Indian authorised representative of this foreign company must provide their own Permanent Account Number (PAN), contact details, and submit their personal Proof of Identity and Proof of Address (such as an Aadhaar card or passport) as annexures.

Surana says: “Further, this representative must sign the verification declaration, explicitly acknowledging that they will be liable for legal consequences under the Act if the declaration is found to be incorrect.”

Gaurav Makhijani, Managing Partner at MGA, says that this new procedural layer adds a practical challenge which is identifying a local representative willing to act, often under a limited power of attorney, which itself can take time due to internal governance processes.

Here are some other changes:

• Foreign entities have to furnish a home-country Tax Identification Number.
• At the same time, compliance has been tightened for individuals as well. TIN is also mandatory for foreign nationals. NRIs and RNORs who are Indian citizens must now furnish their passport number in the PAN application. Applying with Aadhaar alone is no longer sufficient, and additional supporting documents are required.

Due to this change, would Indian persons be reluctant to become an authorised signatory for foreign companies?

To reiterate, the changes introduced under the Income-tax Act, 2025 and the Income-tax Rules, 2026 primarily require additional disclosure of particulars such as PAN, contact details etc. of the Indian authorised signatory/representative.

Shaily Gupta, partner, Khaitan & Co said to ET Wealth Online that in light of these new changes, Indians can be reluctant to take on the role of authorised signatory for foreign companies due to a combination of legal uncertainty and practical challenges.

Gupta says: "While acting in this capacity, individuals lack clarity on the scope of their obligations and how their role may be interpreted by the Income-tax Department, leading to a perceived personal risk."

According to Surana, by providing their personal PAN, residential address, and signing a statutory declaration, the Indian individual legally links their personal profile to the foreign entity's compliance status.

Surana says: “Accordingly, the Indian tax authorities will treat them as the primary point of contact.”

Surana says that if the foreign company evades taxes, fails to file returns, or defaults on statutory compliances, the tax department may direct all initial inquiries, scrutiny notices, and potential penal actions to this Indian authorised signatory.”

Practically speaking, the new requirements may increase the degree of detail involved and also make Indian individuals hesitate, especially if they are not familiar with governance standards of the foreign company or its operational strategy.

Surana says: “However, in well-regulated organisations with proper documentation and defined responsibilities, this should not materially deter individuals from taking up such roles.”

Authorised signatory status is not automatically removed once the signatory resigns from job; hence one should take these precautions

While PAN remains unchanged, authorised signatory roles must be actively revoked as they are not automatically removed.

Surana says: “Individuals should ensure formal revocation on the tax portal, update the company records, and maintain documentary evidence of resignation and cessation of authority.”

According to Gupta, historically, companies have not updated authorised signatory details as there was never a need to do so. As a result, individuals may continue to remain on record even after disassociating from the foreign company, leaving them exposed and dependent on the company to initiate updates, which may not happen in practice.

Gupta says: "Such changes would unnecessarily trigger additional compliance requirements. For foreign companies in particular, the process of updating such records is cumbersome, requiring apostilled documentation, which can be both time-consuming and costly."

What should Indians who are signatories of foreign companies do?

According to Surana, Indian individuals should undertake due diligence before accepting the role, clearly define the scope of authority, and avoid unrestricted signatory powers.

Surana says: “At exit, it is critical to formally revoke authorisation, disable access credentials, and retain proof of cessation to mitigate any potential exposure.”

Gupta says that clarity from the tax authorities on this aspect is awaited and on this same matter, SEBI has already approached the CBDT seeking guidance on the tax role and obligations of authorised representatives, particularly in the context of foreign portfolio investors; similar considerations would extend to authorised signatories of foreign companies.

Gupta says: "Until such clarity emerges, and while it may not be a complete solution, one immediate safeguard could be for individuals to seek appropriate indemnities from the applicant company to mitigate potential risks."