Key GST, Tax & Regulatory Updates – September 2026

1. Corporate Guarantee GST rules may be simplified

  • Corporate Guarantee is a Taxable Supply: A corporate guarantee provided between related parties, such as a holding company for its subsidiary, is treated as a taxable supply of service, even when no fee is charged. GST is generally applicable at 18%.
  • 1% Deemed Valuation Rule: Where no fee or nominal fee is charged, the value is generally deemed to be 1% of the guarantee amount per year under Rule 28(2) of the CGST Rules.
  • Relief Where 100% ITC is Available: If the recipient/borrower is eligible for full Input Tax Credit (ITC), the mandatory 1% deemed valuation does not apply, and the value declared in the invoice is accepted.

2. Green Power Plan for MSME Manufacturing Clusters:

  • Demand Aggregation: SECI plans to combine electricity and industrial-heating requirements of multiple MSMEs to achieve economies of scale and reduce power costs.
  • Shift from Fossil Fuels: The initiative aims to help MSMEs move from gas-fired and other fossil-fuel-based furnaces towards electric and cleaner heating solutions.
  • Lower Upfront Investment: Pooled procurement can help MSMEs overcome the high initial cost of adopting green electricity and electric-furnace technologies.
  • Energy Security & Export Competitiveness: Affordable green power can reduce dependence on fossil fuels and help MSMEs meet international carbon requirements such as the EU’s CBAM.
  • Green Transition: The initiative supports India’s broader MSME green-transition roadmap, with solar power and electric heating becoming increasingly competitive with conventional fossil-fuel options

3. FADS (Foreign Asset Disclosure Scheme) 2026 enabled on Income Tax Portal:

  • One-Time Disclosure Opportunity: FADS 2026 allows eligible taxpayers to voluntarily disclose previously unreported foreign assets and income.
  • Filing Period: The scheme came into effect on 16 August 2026, and declarations can be filed up to 31 December 2026.
  • Valuation Date: Foreign assets covered under the scheme are required to be valued with reference to 31 March 2026.
  • Online Filing: Taxpayers can file Form 1 through the Income Tax e-Filing Portal: e-File → Income Tax Forms → File Income Tax Forms → Under Other Acts → FADS 2026

4. Co-operative banks / penalties – RBI continues publishing enforcement actions and monetary penalties

  • RBI Enforcement: RBI is increasing supervisory action against cooperative banks for banking-law violations, regulatory lapses and inadequate risk management.
  • Recent Penalties: Surat People’s Cooperative Bank – ₹13.30 lakh, Citizens Urban Cooperative Bank – ₹5 lakh, and Nabapalli Cooperative Bank – ₹3 lakh were penalised for various compliance failures.
  • Loan Compliance: Penalties can arise from exceeding lending limits or granting loans to directors, relatives or other restricted parties.
  • KYC & Cybersecurity: Banks can face action for delayed KYC updates, Central KYC Registry lapses and inadequate cybersecurity controls.
  • Unclaimed Deposits: Failure to properly transfer eligible unclaimed deposits to the Depositor Education and Awareness Fund (DEAF) can also result in regulatory penalties.

5. Compliance Due Dates

Due DateComplianceApplicable To
15 Sep 2026PF & ESI payment – Aug 2026Employers
20 Sep 2026GSTR-3B – Aug 2026Monthly GST taxpayers
30 Sep 2026Tax Audit Report – FY 2025-26Tax-audit applicable taxpayers
30 Sep 2026DIR-3 KYCDirectors/DIN holders
30 Sep 2026AGM – FY 2025-26Companies, subject to applicable provisions
30 Sep 2026FADS 2026 declarationEligible taxpayers – subject to scheme conditions

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