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CBDT Signs Record 219 APAs, Crosses 1,000 Milestone in Transfer Pricing

The Central Board of Direct Taxes signed a record 219 Advance Pricing Agreements in FY 2025-26, bringing the cumulative total since the program's inception to 1,034. This year's achievements include India's first-ever bilateral APAs with treaty partners France, Ireland, Indonesia, and Sweden. Complementing the APA scheme, the enhanced Safe Harbour Rules now consolidate multiple tech services into a single category with a 15.5% margin and a higher eligibility threshold. These frameworks collectively aim to provide taxpayers with transfer pricing certainty and protection against double taxation.

Key Points: CBDT Signs Record 219 Advance Pricing Agreements in FY26

  • Record 219 APAs signed in FY26
  • Total APAs cross 1,000 milestone
  • First bilateral deals with France, Ireland, Indonesia, Sweden
  • Safe Harbour Rules enhanced with IT margin at 15.5%
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CBDT signs record 219 Advance Pricing Agreements in FY26

CBDT signs 219 APAs, crossing 1,000 total. New Safe Harbour Rules offer faster certainty for IT services at 15.5% margin.

"taking the total number past the 1,000 mark to an aggregate of 1,034 APAs - CBDT Statement"

New Delhi, March 31

The Central Board of Direct Taxes has entered into a record 219 Advance Pricing Agreements in FY 2025-26 with Indian taxpayers, taking the total number past the 1,000 mark to an aggregate of 1,034 APAs since the inception of the programme, according to an official statement issued on Tuesday.

The figure comprises 750 unilateral APAs (UAPAs) and 284 bilateral APAs (BAPAs).

The BAPAs were signed pursuant to entering into mutual agreements with 13 of India's treaty partners, namely the US, Finland, the UK, Singapore, Japan, South Korea, Australia, Denmark, Sweden, France, Indonesia, Ireland, and New Zealand. Notably, this year also marks the achievement of signing India's first-ever bilateral APAs with France, Ireland, Indonesia, and Sweden. The CBDT has consistently been signing a high number of APAs, having concluded 174 APAs in the previous financial year, and in the year before that, 125 APAs were concluded, the statement said.

Safe Harbour Rules complement the APA framework by offering a faster, lower-cost alternative for achieving transfer pricing certainty. Introduced in 2013, the Safe Harbour framework prescribes fixed margins for specified categories of international transactions. The regime currently spans twelve transaction categories, including IT and software services, IT-enabled services, KPO, contract R&D, intra-group financing, guarantees, auto components, low-value-adding services, and certain transactions in the diamond industry.

The Finance Act 2026 has introduced significant enhancements to the Safe Harbour Rules. Multiple technology service segments have been consolidated into a single "Information Technology Services" category with a uniform 15.5 per cent margin. The eligibility threshold has been increased from Rs 300 crore to Rs 2,000 crore. The amendments also introduce a more system-driven and automated framework, reducing the need for detailed scrutiny and administrative interface.

The APA Scheme, together with Safe Harbour Rules, aims to provide certainty to taxpayers in the area of transfer pricing by specifying pricing methods and determining the arm's length price of international transactions in advance for up to five years. BAPAs offer the added benefit of protection against potential or actual double taxation.

- IANS

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Reader Comments

P
Priya S
As someone who works in finance for an MNC, this is a huge relief. Transfer pricing audits are a nightmare. Having a clear, pre-agreed framework saves so much time and resources. Hope they keep expanding the treaty partner list.
R
Rohit P
Good progress, but I have a question. The eligibility threshold for Safe Harbour is now Rs 2000 crore. Doesn't this mostly benefit the big corporates? What about the smaller IT startups and service firms? They need certainty too.
S
Sarah B
First-time agreements with France, Ireland, Indonesia, and Sweden is a significant diplomatic and economic achievement. It shows India is becoming a more predictable and reliable partner for international trade and investment.
V
Vikram M
Consolidating tech services into one category with a 15.5% margin is very practical. The old system with multiple segments was confusing. This simplification will boost the IT sector for sure. Bharat's digital economy is getting stronger! 💪
K
Kavya N
While the numbers look impressive, I hope the quality of these agreements is robust. The goal should be fair taxation, not just signing more papers. The CBDT must ensure these APAs actually reflect arm's length principles and protect our tax base.

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