Transfer Pricing Documentation for FY 2025-26: Complete Compliance Roadmap for Indian Assessees

Transfer pricing has become one of the most closely examined elements of corporate income tax in India. With the Indian transfer pricing regime now fully aligned with the OECD BEPS framework, documentation standards are significantly more stringent than they were a decade ago. Yet, many Indian corporates still compile their transfer pricing files hurriedly just before the October 31 due date, exposing themselves to unnecessary adjustment and penalty risk.

This guide is designed as a hands-on documentation roadmap for CFOs, finance heads, and their advising CAs for FY 2025-26, covering who needs to comply, what must be documented, and when each filing is due.

1. When Does Transfer Pricing Documentation Become Mandatory?

The statutory obligation to maintain transfer pricing documentation flows from Section 92D of the Income Tax Act 1961, read with Rule 10D of the Income Tax Rules. The requirement applies whenever an assessee enters into an “international transaction” with an “associated enterprise” (AE) during the relevant previous year.

1.1 Scope of International and Specified Domestic Transactions

International transactions with AEs generally include, among others:

  • Purchase or sale of tangible goods or capital items between an Indian entity and its foreign AEs
  • Provision or receipt of services (IT services, management services, technical support, etc.)
  • Intercompany loans, guarantees, and other financial arrangements
  • Cost-sharing or cost-contribution arrangements for shared services, R&D, or marketing
  • Transfer, use, or licensing of intangibles such as trademarks, patents, software, and know-how

In addition, specified domestic transactions (SDTs) are brought into the transfer pricing net when:

  • The aggregate value of such domestic related-party transactions exceeds INR 20 crore in a year, and
  • The transactions fall within the ambit of Section 92BA (for example, certain related-party arrangements, specified business transactions, etc.)

1.2 Statutory Thresholds and Compliance Forms

Key compliance thresholds and filings for FY 2025-26 are as follows:

  • Form 3CEB (Accountant’s Report)

    • Mandatory for every assessee having either international transactions or SDTs, irrespective of the monetary value.
    • Due date: October 31 of the assessment year.

  • Local File (Detailed Transfer Pricing Documentation)

    • Required where the aggregate value of international transactions during the relevant year exceeds INR 100 crore.
    • Must be maintained contemporaneously and should be available for production during assessment/audit.

  • Master File (Form 3CEAA)

    • Applicable when:
      • The Indian entity is part of a multinational enterprise (MNE) group whose consolidated global revenue exceeds INR 500 crore, and
      • Either:
        • The Indian entity’s total international transactions are more than INR 50 crore, or
        • International transactions involving intangibles exceed INR 10 crore.
    • Filing authority: Director General of Income Tax (Risk Assessment).
    • Due date: November 30 of the assessment year.

  • Country-by-Country Report (CbCR)

    • Required where the ultimate parent entity is resident in India and the consolidated group revenue exceeds INR 5,500 crore (approximately EUR 750 million).
    • Filed in the prescribed CbCR form by November 30.

Note: Even where thresholds for Local File or Master File are not triggered, the basic obligation under Section 92D and Rule 10D to maintain a reasonable level of documentation still applies for all international transactions and SDTs reported in Form 3CEB.

2. Core Components of Indian Transfer Pricing Documentation

Indian transfer pricing documentation generally rests on three interconnected pillars—often called the “documentation trinity”:

  1. Master File (Form 3CEAA)
  2. Local File (entity-specific TP documentation)
  3. Form 3CEB (Accountant’s Report)

Each serves a different purpose and is scrutinised at different levels in audit.

2.1 Master File (Form 3CEAA) – Group-Level Overview

The Master File presents a high-level, group-wide narrative of the MNE’s global operations and transfer pricing policies. It is meant to give the tax authorities a consolidated view of:

  • How the group is structured
  • Where value is created
  • How key intangibles and financing are managed

Typical contents include: