The Securities and Exchange Board of India (SEBI) has issued the instrument titled “Reporting requirement under Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) revised through Income-Tax Act, 2025 read with Income-Tax Rules, 2026” — Circular No. HO/38/14/(18)2026-MIRSD-POD2/I/25560/2026, dated 11 November 2026 — directing every SEBI-registered intermediary that qualifies as a Reporting Financial Institution (RFI) to run its FATCA/CRS reporting and due diligence under the new tax regime: section 508 of the Income-tax Act, 2025, Rules 238 to 240 of the Income-tax Rules, 2026, and Form 166. The circular is addressed to all intermediaries registered with SEBI, all stock exchanges and all depositories, and it is signed by Bhumika Kanojia, Deputy General Manager.
Quick Answer: SEBI’s circular of 11 November 2026 tells every SEBI-registered intermediary that is a Reporting Financial Institution to run FATCA/CRS reporting under section 508 of the Income-tax Act, 2025 and Rules 238–240 of the Income-tax Rules, 2026, using Form 166 instead of Form 61B — and to upload the FATCA/CRS certifications it collects from clients onto KRA systems.
In plain business-owner language: if your firm onboards investors, its KYC forms, its client-classification systems and its reporting software must now collect the new FATCA/CRS fields — because a Form 166 filed without the new mandatory fields will be rejected with validation errors on the Income Tax portal. The circular puts the entire onus on the intermediary, not on the client and not on the KRA.
What the circular actually changes
The change is a change of legal chassis, not a new reporting idea. FATCA/CRS reporting itself is not new: SEBI had already told intermediaries about it in three earlier circulars — Circular No. CIR/MIRSD/2/2015 dated 26 August 2015, Circular No. CIR/MIRSD/3/2015 dated 10 September 2015, and Circular No. SEBI/HO/MIRSD/SECFATF/P/CIR/2024/12 dated 20 February 2024. Those circulars were issued under section 285BA of the Income-tax Act, 1961, read with Rules 114F to 114H and Form 61B of the Income-tax Rules, 1962.
What has changed is the statute underneath. Paragraph 2 of the new circular records that the Income-tax Act, 2025, read with the Income-tax Rules, 2026, has replaced the Income-tax Act, 1961, read with the Income-tax Rules, 1962, with effect from 1 April 2026. The reporting requirements under the Automatic Exchange of Information (AEOI) framework for reportable accounts under FATCA/CRS have accordingly been revised in terms of section 508 of the Income-tax Act, 2025, read with Rules 238, 239 and 240, and Form 166 of the Income-tax Rules, 2026.
Paragraph 3 explains why SEBI had to issue this circular at all. In terms of Rule 239(12)(a) of the Income-tax Rules, 2026, the regulator is required to issue instructions or guidelines to its regulated financial institutions to incorporate the reporting and due diligence procedures specified under Rules 238 to 240, prescribe the manner and procedure for maintaining account information, and ensure its availability to satisfy reporting obligations. This circular is that instruction.
Paragraph 5 then gives the operative direction: all registered intermediaries who are RFIs “shall take the necessary steps to ensure compliance with Rules 238 to 240 of the Income-tax Rules, 2026” and are advised to refer to the Guidance Note on FATCA and CRS issued by the Central Board of Direct Taxes. The circular points intermediaries to two official sources — the Income-tax Rules, 2026, and the CBDT’s Guidance Note on FATCA and CRS dated 24 July 2026.
Old framework vs new framework
The table below compares the two frameworks exactly as the circular states them. The “old” column is what paragraph 1 of the 11 November 2026 circular records about the earlier regime; the “new” column is what paragraph 2 prescribes.
Note on the old column: the old-framework entries above are taken from paragraph 1 of the 11 November 2026 circular itself, which recites the earlier circulars and the 1961 Act provisions they rested on. The circular does not re-state the old due-diligence procedures — it replaces their legal basis.
Who is affected — and who is not
The reporting obligations apply to entities that qualify as Reporting Financial Institutions (RFIs). Paragraph 4 of the circular is precise about where the definition lives: “RFI” is defined in Rule 238(8) of the Income-tax Rules, 2026, and “Financial Institution” is defined in Rule 238(3) of the same Rules. The circular does not list entity types — it does not say “brokers” or “mutual funds” or “depositories” — so whether a particular intermediary is caught turns on the Rule 238(8) definition, not on a list in this circular.
That matters for scope. An intermediary that is not an RFI under Rule 238(8) does not pick up the reporting duty from this circular. An intermediary that is an RFI does — and paragraph 5 makes the direction mandatory (“shall take the necessary steps”), not advisory. Stock exchanges and depositories are addressees of the circular alongside intermediaries, but the operative reporting duty in paragraphs 5 to 8 is framed for registered intermediaries who are RFIs.
Investors are affected indirectly but concretely. Intermediaries must now collect self-certifications that capture a validity indicator, identify controlling persons by role, and classify accounts by type and pre-existing/new status — which means clients, including entities and trusts, can expect fresh or updated self-certification requests at onboarding and at review. The certifications intermediaries collect must then be uploaded to the systems of the KYC Registration Agencies (KRAs).
What intermediaries must do now — the four updates plus the KRA upload
Paragraph 6 requires registered intermediaries to incorporate AEOI reporting and due diligence requirements into their customer onboarding and Know Your Customer (KYC) frameworks, and to maintain the information required to meet their obligations under the Income-tax Rules, 2026. It then lists four things intermediaries must, among other things, review and update in accordance with the Rules:
- Self-certification collection procedures — to capture the validity indicator. The self-certification an intermediary collects from a client must now record whether the certification is valid, in the form the new Rules require.
- Controlling Person identification systems — to capture roles. Systems must record the controlling person’s role: settlor, trustee, protector, beneficiary or other. This is the trust and entity-ownership trail that FATCA/CRS reporting runs on.
- Account classification systems — to capture account type and pre-existing/new status. Every account must be classified by type and by whether it is a pre-existing account or a new account, because the due-diligence procedures differ between the two.
- Form 166 XML generation software — to include all new mandatory fields. This is the one with a stated consequence. The circular says, in terms: “Failure to include required fields will result in validation errors on the Income Tax portal.” Reporting software that still generates the old Form 61B output, or a Form 166 without the new mandatory fields, will not file cleanly.
Two further duties sit on top of the four updates. Paragraph 7 requires registered intermediaries to upload the FATCA and CRS certification obtained from clients onto the systems of the KYC Registration Agencies (KRAs) — so the certification does not merely sit in the intermediary’s own files; it must reach the KRA system. This KRA-upload duty is not new: SEBI’s earlier circular of 20 February 2024 already required intermediaries who are RFIs to upload client FATCA/CRS certifications to KRA systems with effect from 1 July 2024 (existing certifications within 90 days). The 11 November 2026 circular restates the duty under the new Rules. And paragraph 8 fixes responsibility: “The onus of obtaining and reporting the FATCA and CRS certification and related compliances shall lie solely with the respective intermediaries.” A client’s delay, or a vendor’s software gap, does not shift the onus away from the intermediary.
What to do next — a short checklist for an RFI intermediary:
- Read Rules 238 to 240 of the Income-tax Rules, 2026 and the CBDT Guidance Note on FATCA and CRS dated 24 July 2026 — the circular points to both.
- Map every field your onboarding and KYC forms collect against the new requirements: self-certification validity indicator, controlling-person roles, account type and pre-existing/new status.
- Ask your software vendor (or your in-house team) to confirm Form 166 XML generation includes all new mandatory fields — and test a filing, because missing fields mean validation errors on the Income Tax portal.
- Set up the upload of client FATCA/CRS certifications to KRA systems, and assign a named owner inside the firm — the onus is solely yours.
- Do not wait for a separate deadline: the circular contains none, and the new regime has applied since 1 April 2026.
What the circular does not do
Three limits are worth stating plainly, because they are easy to misread. First, the circular sets no separate deadline — it contains no effective-date paragraph and no filing or reporting due date of its own. The only dates in it are 1 April 2026 (when the Income-tax Act, 2025 and the Income-tax Rules, 2026 replaced the 1961 Act and 1962 Rules) and 24 July 2026 (the date of the CBDT Guidance Note). An intermediary that reads the circular looking for a grace period will not find one.
Second, the circular states no penalty for non-compliance. The only consequence it names is practical, not penal: a Form 166 without the new mandatory fields will fail validation on the Income Tax portal. Any penalty question would have to be answered from the Income-tax Act, 2025 itself, which this circular does not address.
Third, the circular does not change the underlying AEOI framework’s scope by itself — it aligns SEBI’s directions with the new tax code. The definitions that decide who must report sit in Rules 238(3) and 238(8) of the Income-tax Rules, 2026, and the detailed guidance sits in the CBDT’s Guidance Note of 24 July 2026. This circular is the bridge between SEBI’s regulated intermediaries and that new framework.
The circular is issued in exercise of powers conferred under section 11(1) of Chapter IV of the Securities and Exchange Board of India Act, 1992, read with Rule 239(12)(a) of the Income-tax Rules, 2026, to protect the interests of investors in securities and to promote the development of, and to regulate, the securities markets.
Why this matters now
The timing is the story. The Income-tax Act, 2025 and the Income-tax Rules, 2026 have been in force since 1 April 2026, and the CBDT’s Guidance Note has been available since 24 July 2026 — but SEBI’s own direction to its intermediaries, the instruction Rule 239(12)(a) requires the regulator to issue, arrived only on 11 November 2026. For seven months, intermediaries were operating under a new tax code while SEBI’s standing directions still pointed at the repealed 1961 framework. This circular closes that gap, and it does so in mandatory terms. Firms that treated FATCA/CRS as a settled, legacy process — forms filed, software frozen — now have a concrete rebuild list, and the rebuild is not optional: the portal itself will reject a Form 166 that omits the new fields.
It also sits inside a wider November pattern of SEBI re-anchoring KYC to the new tax code. The same regulator’s 4 November 2026 circular lets individual NRIs, OCIs and foreign nationals complete KYC digitally from abroad from 3 December 2026, and its 30 October 2026 circular reset FPI KYC review cycles to two or eight years from 1 December 2026. The FATCA/CRS circular is the third leg: the reporting that sits behind the KYC front door, now re-based on the Income-tax Act, 2025. Read together, the three circulars say the same thing — the compliance stack that was built on the 1961 Act is being moved, piece by piece, onto the 2025 Act, and the firms that move early will not be the ones debugging validation errors at filing time.
Frequently asked questions
What is SEBI’s 11 November 2026 FATCA/CRS circular?
It is SEBI Circular No. HO/38/14/(18)2026-MIRSD-POD2/I/25560/2026, titled “Reporting requirement under Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) revised through Income-Tax Act, 2025 read with Income-Tax Rules, 2026”. It directs SEBI-registered intermediaries that are Reporting Financial Institutions to comply with Rules 238 to 240 of the Income-tax Rules, 2026 and to report in Form 166 under section 508 of the Income-tax Act, 2025.
What is Form 166 and what does it replace?
Form 166 is the reporting form under the Income-tax Rules, 2026 for FATCA/CRS reporting. It replaces Form 61B, which was the form under Rules 114F to 114H of the Income-tax Rules, 1962. Intermediaries must update their Form 166 XML generation software to include all new mandatory fields.
Which intermediaries must comply with the new FATCA/CRS rules?
Only intermediaries that qualify as Reporting Financial Institutions (RFIs). “RFI” is defined in Rule 238(8) of the Income-tax Rules, 2026 and “Financial Institution” in Rule 238(3). The circular does not list entity types, so an intermediary must test itself against the Rule 238(8) definition.
What happens if Form 166 mandatory fields are missing?
The circular states the consequence directly: failure to include the required fields will result in validation errors on the Income Tax portal. The filing will not go through cleanly until the software generates all new mandatory fields.
Do intermediaries have to upload FATCA/CRS certificates to KRAs?
Yes. Paragraph 7 of the circular requires registered intermediaries to upload the FATCA and CRS certification obtained from clients onto the systems of the KYC Registration Agencies (KRAs). Paragraph 8 adds that the onus of obtaining and reporting the certification and related compliances lies solely with the respective intermediaries.
Is there a deadline in the SEBI FATCA/CRS circular?
No. The circular contains no separate effective-date paragraph and no filing or reporting deadline. The new tax regime it implements — the Income-tax Act, 2025 and the Income-tax Rules, 2026 — has applied since 1 April 2026, and the CBDT Guidance Note it refers to is dated 24 July 2026.
How is this different from SEBI’s FPI KYC and PROI KYC circulars of October–November 2026?
They are different instruments for different things. The 30 October 2026 FPI circular resets how often Foreign Portfolio Investors’ KYC is reviewed (every 2 or 8 years from 1 December 2026), and the 4 November 2026 PROI circular lets individual NRIs, OCIs and foreign nationals complete KYC digitally from abroad from 3 December 2026. The 11 November 2026 FATCA/CRS circular is about the tax-information reporting that sits behind KYC — which form to file, which rules govern it, and what client certifications must be uploaded to KRAs.
Related reading
- SEBI PROI KYC Circular November 2026: NRIs and OCIs Can Complete KYC Digitally from Abroad from 3 December
- SEBI FPI KYC Review: New 2-Year and 8-Year Cycles from 1 December 2026
Sources
- Primary source: SEBI Circular No. HO/38/14/(18)2026-MIRSD-POD2/I/25560/2026 dated 11 November 2026 — “Reporting requirement under Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) revised through Income-Tax Act, 2025 read with Income-Tax Rules, 2026” (official SEBI PDF) — sebi.gov.in (PDF)
- SEBI circular page (official) — sebi.gov.in
- CBDT Guidance Note on FATCA and CRS dated 24 July 2026 (official, cited in the circular) — incometaxindia.gov.in (PDF)
- Income-tax Rules, 2026 (official, cited in the circular) — incometaxindia.gov.in
Last verified by team: 11 November 2026, against the official SEBI circular PDF. Every factual claim in this article traces to that circular; points the circular does not address are marked as not stated.
