The income tax department has introduced Form 68 under the Income-tax Act, 2025 for specified investment funds to file exempt income statements and claim tax benefits for eligible non-resident investors. According to reports from Mint, this form is not meant for individual taxpayers but applies specifically to specified investment funds that seek exemption under Section 11 read with Schedule VI (Table, Serial Nos. 1 to 4) of the Income-tax Act, 2025. The benefit is available only where the non-resident investor does not have a permanent establishment in India. As per the Income Tax Department's FAQs, filing Form 68 is a mandatory condition for making a valid claim for this exemption under the Income-tax Act, 2025. The form serves as the annual reporting mechanism through which eligible specified funds disclose exempt income and support their claim for tax exemption under the new tax regime.
The requirement to file Form 68 applies to specified funds including Category III Alternative Investment Funds (AIFs), Retail Funds and Exchange Traded Funds (ETFs). According to Mint, these funds must file the form annually if they claim exemption on income attributable to eligible non-resident unit holders. The form must be verified by the Principal Officer or Managing Trustee of the specified fund, who confirms that the information furnished is true and correct, the fund meets prescribed eligibility conditions, and units held by resident investors have not been treated as non-resident holdings while calculating the exempt income. However, filing the form by itself does not automatically entitle a fund to the exemption. The specified fund must also satisfy all other eligibility conditions prescribed under the Income-tax Act, 2025 and the relevant rules. The form is part of the compliance framework under the new tax law and is not meant for individual taxpayers.
According to Mint, Form 68 must be filed electronically on the e-filing portal of the income tax department and verified under digital signature or electronic verification code by the authorized person. The form cannot be submitted offline, and PAN is mandatory for both the specified fund and the Principal Officer or Managing Trustee verifying the form. Required documents include a copy of the trust deed or memorandum of association, certificate of registration issued by the IFSC, annual financial statements, statement of securities including income earned on securities held, and details of unit holders with their classification by residency status. The department has made two annexures mandatory - Annexure A1 captures details of income arising from the transfer of securities during the tax year, while Annexure A2 contains details of income from securities issued by non-residents and income earned from securitisation trusts. No. Once Form 68 has been submitted, duly verified and an acknowledgement has been generated, it cannot be edited or revised. The department advises specified funds to ensure all details are accurate before final submission.
As reported by Mint, the statement of exempt income in Form 68 must be filed on or before the due date for filing return of income prescribed under section 263(1)(c) of the Income-tax Act, 2025, as applicable to the specified fund claiming the exemption. The applicable due date depends on the category of the specified fund. The form also cannot be filed without a valid Permanent Account Number (PAN) of both the specified fund and the Principal Officer or Managing Trustee verifying the statement. According to the Income Tax Department, filing Form 68 within the prescribed time limit is a mandatory compliance requirement for specified funds claiming exemption on eligible income attributable to non-resident investors.
