Liaison Office Annual Statement (Form 162) Under the Income Tax Act 2025

A non-resident that runs a liaison office in India must send the tax department an annual statement of that office's activities. The duty is in section 505 of the Income-tax Act, 2025. Rule 234 of the Income-tax Rules, 2026 sets the form (Form No. 162) and the deadline: within eight months from the end of the financial year, filed electronically with a digital signature.

This guide explains who is covered, what to file, when, who verifies it, and how to work out the date. Every point below is taken from section 505 and rule 234, as amended by the Finance Act, 2026. The statement is a reporting duty. The Act text does not describe it as a tax computation.

Who has to submit the liaison office statement?

Section 505 applies to every person who meets both of these conditions:

• The person is a non-resident.
• The person has a liaison office in India set up as per the guidelines issued by the Reserve Bank of India under the Foreign Exchange Management Act, 1999.

A liaison office that was not set up under those RBI guidelines is not described by section 505. If you are unsure whether an office qualifies, check the RBI approval before deciding.

What must the statement contain, and to whom is it given?

The statement covers the office's activities in a tax year. Section 505 requires the non-resident to prepare it and deliver it to the Assessing Officer having jurisdiction. The form and the particulars are left to the Rules, and rule 234(1) prescribes Form No. 162. The Act and rule text provided here do not list the fields of Form 162, so use the form itself as the checklist.

What is the due date for Form 162?

Under rule 234(1), the statement is due within eight months from the end of the financial year. A financial year ends on 31 March, so the due date works out to 30 November.

Year covered	Year ends	Eight months later	Due date
2025-26	31 March 2026	April to November 2026	30 November 2026
2026-27	31 March 2027	April to November 2027	30 November 2027

Rule 234 says "financial year" while section 505 says "tax year". For a regular liaison office the two cover the same April to March period, but read the form's instructions for the period it asks about.

How is Form 162 filed and who verifies it?

Rule 234(2) sets two requirements:

1. The statement is furnished in electronic form with a digital signature.
2. It is verified by a Chartered Accountant or by a person the non-resident has authorised for this. That person is called the authorised signatory.

Worked examples

Example 1: working out the date for 2026-27

1. Liaison office of a foreign firm, set up under RBI guidelines. Financial year 2026-27 ends on 31 March 2027.
2. Count eight months from that date: April, May, June, July, August, September, October, November 2027.
3. The statement in Form 162 is due by 30 November 2027.

Example 2: a year that is already running

1. Assumption: today is 10 November 2026 and the office covers the financial year 2025-26, which ended on 31 March 2026.
2. Eight months from 31 March 2026 ends on 30 November 2026.
3. Days left from 10 November: 20 days (30 minus 10). The CA verification and digital signature should be arranged first.

Real-life scenarios

Ravi, a Chartered Accountant, looks after the India affairs of a foreign trading company whose only presence is an RBI-approved liaison office. Each year he puts 30 November in his calendar, prepares Form 162 from the office's records, signs it digitally and files it. He verifies it himself under rule 234(2) as the Chartered Accountant.

Meena is the country manager of a foreign consultancy's liaison office. The head office has no CA in India on its payroll, so it authorises Meena in writing as its authorised signatory. Rule 234(2) allows verification by "the person authorised in this behalf by the non-resident person", so Meena verifies and files with her digital signature.

Common mistakes

• Treating it as optional because the office earns no income. Section 505 applies to every non-resident with an RBI-guideline liaison office. It is not tied to any income level in the text.
• Counting from the wrong date. The eight months run from the end of the financial year (31 March), not from the date of a board meeting or the audit.
• Missing the digital signature. Rule 234(2) asks for electronic filing with a digital signature. Arrange the signature early.
• Unclear authority. If someone other than a CA verifies, keep the authorisation on record.
• Filing to the wrong officer. The statement goes to the Assessing Officer having jurisdiction.

Quick reference

Point	Position	Source
Who	Non-resident with RBI-guideline liaison office in India	Section 505
What	Statement of activities in a tax year	Section 505
Form	Form No. 162	Rule 234(1)
Due	Within eight months from the end of the financial year	Rule 234(1)
Mode	Electronic, with digital signature	Rule 234(2)
Verified by	Chartered Accountant or authorised signatory	Rule 234(2)
Delivered to	Assessing Officer having jurisdiction	Section 505
Late filing	Rs. 1,000 a day up to three months, else Rs. 1,00,000	Section 460

What is the penalty for not filing the statement?

Section 460 lets the Assessing Officer impose a penalty if the statement is not furnished within the prescribed period:

Length of failure	Penalty
Continues for up to three months	Rs. 1,000 for every day the failure continues
Any other case (longer than three months)	Rs. 1,00,000

Example: a liaison office files the 2025-26 statement 45 days after 30 November 2026 and the Assessing Officer imposes the section 460(a) penalty. Rs. 1,000 x 45 days = Rs. 45,000. If the failure runs on past three months, the penalty under section 460(b) is Rs. 1,00,000.

Under section 470, no penalty under section 460 is imposed if the person proves there was a reasonable cause for the failure. The word is "may" in section 460, so the penalty is not automatic.

Where this is in the Act

• Section 505: statement by a non-resident having a liaison office
• Rule 234: annual statement in Form No. 162, due date, electronic filing, verification
• Section 460: penalty for failure to submit the statement; section 470: reasonable cause

For other rules on non-resident payments, see TDS on payments to non-residents.

If you handle several such offices, the hard part is the calendar: one fixed November date per client, a CA sign-off and a digital signature each. Finexo's practice management software tracks these recurring deadlines across your client book. It does not file Form 162 for you.

This article explains the Income-tax Act, 2025 (as amended by the Finance Act, 2026) and the Income-tax Rules, 2026. It is general information, not tax advice. Confirm the position for a specific case with a qualified chartered accountant.