A new mandatory pre-departure tax filing requirement, Form 156, has triggered significant confusion and compliance concerns among Indian travelers. Despite the rule coming into force from April 1, 2026, the necessary e-filing utility remains unavailable on the Income Tax Department's official portal, leaving taxpayers without a mechanism to comply.
Mandatory Filing, Missing Portal
Under amendments to Income-tax Rules, 2026 (Rules 228–229 and notification G.S.R. 198(E) dated March 20, 2026), individuals holding a Permanent Account Number (PAN) are now required to electronically file Form 156 before traveling abroad. This form is designed to capture key details such as the purpose and estimated duration of overseas travel, signaling a shift towards event-based tax reporting.
However, the practical implementation has exposed a critical flaw: the Form 156 utility has not been activated or made accessible on the e-filing portal. This gap means that while compliance is legally mandated, it is currently impossible for travelers or tax professionals to execute.
Travelers Face Uncertainty
The timing of this issue coincides with a peak travel season, raising alarms for students heading abroad, business travelers, and tourists. CA Anupam Sharma, who formally escalated the matter to the Central Board of Direct Taxes (CBDT), highlighted that both travelers and tax professionals cannot locate any filing link or offline utility. He warned that this situation could lead to unnecessary delays or questioning by Customs or Immigration authorities at departure points, despite the systemic inability to comply.
Calls for Urgent Intervention
In his representation to the CBDT, CA Sharma urged immediate intervention to prevent widespread disruption. His recommendations include:
- Expediting Utility Rollout: Prompt activation of the Form 156 e-filing utility to enable seamless compliance.
- Grace Period/Waiver: Issuance of a formal clarification or circular granting a grace period or interim waiver until the digital infrastructure is fully functional.
- Inter-Ministry Coordination: Collaboration with the Ministry of Home Affairs (Immigration authorities) to ensure travelers are not harassed or delayed during this transition phase.
Experts emphasize that while the objective of tracking outbound travel data aligns with improving tax transparency, the success of such measures hinges on execution readiness. A disconnect between regulatory enforcement and system availability risks eroding taxpayer trust and causing avoidable stress.
As of now, the CBDT has not issued an official clarification addressing the issue. Stakeholders are closely monitoring for swift action to bridge this critical gap between policy and implementation, especially with outbound travel volumes on the rise and the Form 156 tax rule already in effect.