The Central Board of Direct Taxes (CBDT) on Wednesday extended by six years the timeline for tax exemption to sovereign wealth funds and pension funds for making eligible investments.
Earlier, such investments were allowed up to FY25 (AY26). With the latest amendment, these funds can now invest up to FY31.
In cases where references were made to FY26, they will now be read as FY32.
The move provides significant relief to sovereign wealth funds, pension funds and other specified entities investing in India, particularly in infrastructure and other priority sectors under section 10(23FE) of the Income Tax Act.
The section allows tax exemption on income earned by certain notified entities, including sovereign wealth funds, pension funds and other long-term investors, provided the income is from investments in India’s infrastructure or other priority areas.
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