CBDT Notification: Half-Yearly SFT Reporting by Depositories to Facilitate Capital Gains Pre-Filling in ITRs:

The Central Board of Direct Taxes has prescribed the format, procedure and guidelines for submission of Statement of Financial Transactions (SFT-2517) for Depository Transactions under Section 508(1) of the Income Tax Act, 2025, read with Rule 237(6) of the Income Tax Rules, 2026.

Section 508 of the Income Tax Act, 2025 read with Rule 237 requires specified reporting persons to furnish SFTs. In particular, Rule 237(6) provides for reporting information relating to capital gains arising from transfer of listed securities or units of Mutual Funds, in the prescribed manner and frequency. The DGIT (Systems), with the approval of the CBDT, has accordingly issued detailed guidelines, data structures and validation rules. 

All depositories covered by Section 2(1)(e) of the Depositories Act, 1996 are required to prepare the prescribed data file from their internal systems and submit it through the SFTP server using the credentials communicated to them. A separate control statement is also required to be signed, verified and furnished by the Designated Director. 

The SFT is required to be furnished on a half-yearly basis. The statement for the first half of the financial year ending September 30 is required to be furnished on or before October 31, while the statement for the remaining half ending March 31 is required to be furnished on or before April 30. Reporting entities must also provide the reported information to account holders to enable reconciliation with the Annual Information Statement (AIS). 

The notification provides that the Depository Transaction Summary will be used for pre-filling gain/income/loss from securities transactions and will cover user-initiated debit transactions in demat accounts. For off-market debits, information is not required where the transferor and transferee are the same person. For determining whether an asset is a short-term or long-term capital asset, the guidelines require the securities to be classified according to the specified security class. 

The period of holding is to be determined by applying the First-in-First-Out (FIFO) method for identifying the corresponding credit transaction. Listed equity shares, preference shares and several other specified securities generally carry a 12-month minimum holding period, while certain listed or unlisted units carry different periods. Market Linked Debentures are to be treated as short-term capital assets.  

The CBDT notification has been issued with the Board's approval and comes into effect from the date of issue, i.e. September 10, 2026. 

For Full Information, refer to the notification given