The Central Government has notified the Social Protection Fund (SPF), Oman as a "specified person" under the provisions of the Income-tax Act, 2025, enabling the fund to claim tax exemption benefits on eligible investments made in India until 31 March 2030, subject to prescribed conditions.
The notification has been issued by the Central Board of Direct Taxes (CBDT) through Notification No. 84/2026, dated 15 July 2026, and published in the Official Gazette.
What the Notification Provides
Under Schedule V of the Income-tax Act, 2025, certain sovereign wealth funds and pension funds are eligible for tax exemptions on specified investments in India. Through the latest notification, the government has granted this status to the Social Protection Fund (PAN: ABOCS3010J), allowing it to avail exemption benefits for eligible investments made in India from the date of publication of the notification up to 31 March 2030.
The recognition has been granted under the provisions of Schedule V read with Section 11 of the Income-tax Act, 2025.
Key Conditions for Tax Exemption
The notification lays down several conditions that SPF must satisfy to continue enjoying the exemption:
1. Timely Filing of Income Tax Returns
The fund must file income tax returns for all relevant years within the prescribed due dates and furnish a compliance certificate in Form 176 from a qualified accountant along with the return.
2. Quarterly Reporting of Investments
Details of every investment made in India must be reported to the tax authorities within one month from the end of each quarter through Form 175.
3. Separate Accounting Requirements
The fund is required to maintain a segregated account of income and expenditure relating to investments that qualify for tax exemption under Schedule V.
4. Continued Regulation in Oman
The SPF must continue to remain regulated under the laws of the Government of Oman.
5. Purpose of the Fund
The fund must operate exclusively for administering assets and meeting statutory obligations relating to retirement benefits, social security, employment benefits, disability benefits, death benefits, or similar welfare schemes for participants and beneficiaries.
6. Restriction on Private Benefit
Income and assets of the fund must be used solely for fulfilling its statutory obligations and defined contributions. No part of the earnings should benefit any private person, except in limited circumstances relating to creditors or depositors.
7. No Borrowings for Indian Investments
The notification specifically prohibits the fund from using direct or indirect loans or borrowings for making investments in India.
8. No Participation in Day-to-Day Management
While the fund may monitor its investments and appoint directors where necessary to protect its interests, it cannot participate in the day-to-day operations of the investee entity.
Consequences of Non-Compliance
CBDT has clarified that violation of any of the conditions prescribed under Schedule V or the notification itself will make the Social Protection Fund ineligible for the tax exemption.
Impact
The notification is another step in India's policy of encouraging long-term foreign institutional investments from regulated pension and sovereign funds. By granting specified status to the Social Protection Fund of Oman, the government seeks to facilitate investment inflows while ensuring compliance with stringent reporting, governance, and operational requirements. The exemption remains available only so long as all conditions continue to be satisfied.
Effective Date: The notification came into force on 15 July 2026, the date of its publication in the Official Gazette.
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