Section 92A → Section 181
Meaning of associated enterprise
Quick Answer
Section 92A of the Income Tax Act, 1961 (Meaning of associated enterprise) corresponds to Section 181 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 92A
The starting point is Section 92A of the Income Tax Act, 1961 — meaning of associated enterprise. Defines what constitutes an 'Associated Enterprise' based on shareholding (≥26%), control over board, or heavy financial dependency.
From 1st April 2026, the same subject sits at Section 181 of the Income-tax Act, 2025 — retained and renumbered as Section 181 of the Income-tax Act, 2025. Definition widened. Shadow directors and algorithmic control over supply chains now explicitly trigger the Associated Enterprise status.
For Section 92A, the practical impact is rated High. Determines which entities get dragged into Transfer Pricing audits.
Sec 92A
Provision Summary
Defines what constitutes an 'Associated Enterprise' based on shareholding (≥26%), control over board, or heavy financial dependency.
Sec 181
Provision Summary
Definition widened. Shadow directors and algorithmic control over supply chains now explicitly trigger the Associated Enterprise status.
Key Changes & Highlights
- Focus shifted from mere equity holding to 'de-facto' economic control.
Frequently Asked Questions
What is Section 92A of the Income Tax Act, 1961 about?
Section 92A of the Income Tax Act, 1961 covers meaning of associated enterprise. Defines what constitutes an 'Associated Enterprise' based on shareholding (≥26%), control over board, or heavy financial dependency.
Which section replaces Section 92A in the Income-tax Act, 2025?
Section 92A of the Income Tax Act, 1961 maps to Section 181 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Definition widened. Shadow directors and algorithmic control over supply chains now explicitly trigger the Associated Enterprise status.
What is the impact of the change to Section 92A under the new tax code?
The transition impact for Section 92A is rated High. Determines which entities get dragged into Transfer Pricing audits.
What should I watch out for when Section 92A moves to the 2025 code?
Focus shifted from mere equity holding to 'de-facto' economic control. These points are specific to Section 92A (Meaning of associated enterprise).
Disclaimer: This mapping of Section 92A (Meaning of associated enterprise) to Section 181 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 92A is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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