Taxpayers earning income from asset transfers in India must file a structured accountant-certified report explaining income calculations from asset transfers. According to reports from Upstox and Mint, this reporting requirement applies to individuals or entities who have earned income from transferring assets located in India. The report is mandatory if the income from asset transfer is chargeable to tax in India and must be filed along with the income tax return through the income tax e-filing portal. As per Mint, tax is paid by the recipient who has earned the income, not the former owner, and filing becomes mandatory when any income from asset transfer is chargeable to tax in the country.
The accountant-certified report must be prepared by a qualified accountant appointed by the taxpayer and filed along with the income tax return. As reported by Upstox and Mint, key documents required include financial statements, valuation reports of assets, transaction-related documents, and taxpayer contact details. The report cannot be filed separately from the income tax return and must follow the same due date applicable to the taxpayer category. A valid PAN is mandatory for filing, while Aadhaar is not required but a mobile number is strongly recommended for communication purposes, as it enables seamless communication with the I-T Department including OTPs and alerts.
The accountant must register and generate a UDIN (Unique Document Identification Number) before submitting the report electronically on the income tax portal with a digital signature. According to Mint, the dedicated accountant must first register and generate a Unique Document Identification Number (UDIN), following which the report is submitted electronically on the income tax portal using a valid digital signature. Once submitted and acknowledged, the report cannot be edited. Any corrections require filing a revised return of income by the applicable due date. The reporting is governed under Section 9(10) of the Income-tax Act, 2025 and corresponds to Section 9(1) of the Income-tax Act, 1961, read with Rule 11 of the Income-tax Rules, 2026 and Rule 11UC of the Income-tax Rules, 1962.
The reporting requirement applies to taxpayers filing their income tax return in ITR-2 or ITR-3, depending on whether the income from asset transfer is classified under capital gains or business income. As reported by Upstox and Mint, the report helps the tax department verify the correctness of income calculation from asset transfers and ensures smoother processing of the return of income. The filing process is designed to provide transparency and accuracy in reporting income from asset transfers in India. Specific exemptions exist under Section 47 of the Income Tax Act, where certain transactions are not treated as transfers for capital gains purposes and are exempt from capital gains tax, with benefits available only if the transfer occurred within the family for individual taxpayers.
