Section 115AD → Section 113
Tax on income of Foreign Institutional Investors from securities or capital gains
Quick Answer
Section 115AD of the Income Tax Act, 1961 (Tax on income of Foreign Institutional Investors from securities or capital gains) corresponds to Section 113 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 115AD
The starting point is Section 115AD of the Income Tax Act, 1961 — tax on income of foreign institutional investors from securities or capital gains. Provides specific concessional tax rates for Foreign Portfolio Investors (FPIs/FIIs) investing in the Indian stock market.
The new code maps this to Section 113: the provision is retained and renumbered as Section 113 of the Income-tax Act, 2025, applying from 1st April 2026. Retained to maintain the stability of foreign capital inflows into Dalal Street.
On the ground, changes to Section 115AD carry a Critical impact. Directly impacts the Sensex/Nifty foreign inflow liquidity.
Sec 115AD
Provision Summary
Provides specific concessional tax rates for Foreign Portfolio Investors (FPIs/FIIs) investing in the Indian stock market.
Sec 113
Provision Summary
Retained to maintain the stability of foreign capital inflows into Dalal Street.
Key Changes & Highlights
- Surcharge rates on FPIs capped to prevent them from hitting the Maximum Marginal Rate (MMR).
Frequently Asked Questions
What does Section 115AD of the Income Tax Act 1961 deal with?
Section 115AD of the Income Tax Act, 1961 covers tax on income of foreign institutional investors from securities or capital gains. Provides specific concessional tax rates for Foreign Portfolio Investors (FPIs/FIIs) investing in the Indian stock market.
Where does Section 115AD of the ITA 1961 go under the Income-tax Act, 2025?
Section 115AD of the Income Tax Act, 1961 maps to Section 113 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained to maintain the stability of foreign capital inflows into Dalal Street.
Why does the change to Section 115AD matter for taxpayers?
The transition impact for Section 115AD is rated Critical. Directly impacts the Sensex/Nifty foreign inflow liquidity.
What are the key changes to Section 115AD under the Income-tax Act, 2025?
Surcharge rates on FPIs capped to prevent them from hitting the Maximum Marginal Rate (MMR). These points are specific to Section 115AD (Tax on income of Foreign Institutional Investors from securities or capital gains).
Disclaimer: This mapping of Section 115AD (Tax on income of Foreign Institutional Investors from securities or capital gains) to Section 113 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 115AD is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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