SFT – 2517: Depository Transaction Reporting & Key Guidelines

SFT – 2517: Depository Transaction Reporting, Due Dates & Key Guidelines

The CBDT has prescribed the format, procedure and guidelines for filing SFT-2517 for depository transactions under the Income-tax Act, 2025 and Income-tax Rules, 2026.

The SFT-2517 reporting framework covers information relating to depository transactions and is intended to support the pre-filling of income, capital gains and loss information in income-tax returns.

This article explains the SFT-2517 filing requirements, due dates, transaction reporting rules, FIFO method, security classification, acquisition cost, off-market transactions, correction statements and validation requirements in a simple and practical manner.

SFT – 2517 – Quick Overview

The reporting framework requires specified reporting entities to prepare the prescribed data files from their internal systems and submit them through the designated SFTP mechanism.

What is SFT-2517?

SFT-2517 is the prescribed Statement of Financial Transactions reporting framework for specified depository transactions.

The framework has been issued under the provisions requiring specified reporting persons to furnish information relating to financial transactions to the Income Tax Department.

The information relating to securities transactions is intended to assist in pre-filling relevant information in taxpayers’ income-tax returns.

The framework specifically covers information relating to capital gains arising from the transfer of listed securities and units of Mutual Funds.

Who is required to report SFT-2517?

The notification specifically covers Depositories as defined under the Depositories Act, 1996.

The reporting entity is required to generate the prescribed data files from its internal system and submit them through the designated SFTP server.

In addition to the transaction files, a separate Control Statement is required to be signed, verified and furnished by the designated responsible person.

What is the SFT-2517 due date?

SFT-2517 is required to be furnished twice during the financial year.

First half of the financial year

The first reporting period covers: 1 April to 30 September

The SFT is required to be furnished by: 31 October

Second half of the financial year:

The second reporting period covers: 1 October to 31 March

The SFT is required to be furnished by: 30 April

The prescribed half-yearly filing schedule is specifically provided in the notification.

Why is SFT-2517 important?

SFT reporting is important because the information submitted by reporting entities may subsequently be used by the Income Tax Department for providing transaction information to taxpayers.

The reported information is intended to help taxpayers reconcile their securities transactions and assist in the pre-filling of their income-tax returns.

The reporting framework also requires reporting entities to provide relevant information to the account holder so that the taxpayer can reconcile it with the information appearing in the Annual Information Statement (AIS).

For taxpayers dealing in shares, mutual funds and other securities, this makes reconciliation between:

• Demat statements;
• Broker statements;
• Capital-gain statements;
• AIS; and
• Income-tax return data

particularly important.

What information is reported under SFT-2517?

The SFT-2517 framework contains different files for different categories of information.

Broadly, the reporting structure covers:

1. Depository Batch File
2. Depository Account Summary
3. Depository Transaction Summary
4. Depository Off-Market Transaction File
5. Control Statement

Each file contains prescribed fields and information.

Depository Account Summary

The Depository Account Summary contains account-level information relating to demat account holders.

The information includes, among other details:

• Financial year;
• Reporting period;
• DP ID;
• Client ID;
• Depository Participant name;
• PAN;
• Name of first holder;
• Client type;
• Client status;
• Guardian details in case of a minor;
• Address;
• City and State;
• PIN code;
• Mobile number;
• Email ID;
• Joint-holding information;
• Second-holder details;
• Third-holder details;
• Opening value;
• Market credits;
• Market debits;
• Off-market credits;
• Off-market debits;
• IPO credits;
• Corporate-action credits;
• Corporate-action debits;
• Dematerialisation credits;
• Rematerialisation debits;
• Pledge invocation credits;
• Pledge invocation debits; and
• Closing value.

The prescribed data structure specifies these fields for the Depository Account Summary file.

Depository Transaction Summary

The Depository Transaction Summary contains security-level information relating to sales and other relevant debit transactions.

The prescribed fields include:

• Sequence number;
• Financial year;
• Reporting period;
• DP ID;
• Client ID;
• PAN;
• Client name;
• Security class;
• Security code;
• Security name;
• Debit date;
• Debit type;
• Credit type;
• Asset type;
• Quantity;
• Unit price;
• Sale consideration;
• Cost of acquisition;
• Fair market value;
• Adjusted fair market value;
• Adjusted cost of acquisition;
• Indexed cost of acquisition, wherever applicable; and
• Purchase flag.

The transaction summary is therefore intended to provide sufficient information for the Income Tax Department to use the transaction data for return pre-filling and related purposes.

How is sale consideration determined under SFT-2517?

The estimated sale consideration for a debit transaction is determined using the weighted average price, taking into account the actual value of the transaction.

This information is used for reporting purposes.

However, the framework recognises that the taxpayer may modify the sale consideration while filing the income-tax return, where required.

Therefore, taxpayers should not blindly rely on pre-filled information. The actual transaction documents and applicable tax provisions should be considered while preparing the final return.

FIFO method under SFT-2517

One of the important requirements is the use of the First-In-First-Out (FIFO) method.

For each relevant debit transaction, the corresponding credit transaction is identified using FIFO.

In simple terms, the earliest available purchase of a particular security is generally matched against the earliest subsequent sale.

Example

Suppose an investor purchases:

• 100 shares in January;
• 150 shares in March; and
• 200 shares in June.

If 180 shares are sold later, the FIFO approach would generally match:

• 100 shares purchased in January; and
• 80 shares purchased in March.

The acquisition dates and estimated acquisition costs of the matched lots are then relevant for determining the holding period and related information.

The notification specifically requires FIFO for identifying the corresponding credit transaction.

Short-term and long-term classification

The securities are required to be classified into prescribed security classes.

The holding period is then considered for determining whether the security qualifies as a short-term or long-term capital asset under the applicable framework.

The prescribed security classes include:

The notification specifies the corresponding treatment and holding periods for these categories.

Holding period for securities under SFT-2517

The prescribed framework provides different holding periods depending on the type and status of the security.

Some important categories are:

Listed equity shares: Holding period: 12 months

Listed preference shares: Holding period: 12 months

Eligible listed debentures: Holding period: 12 months, subject to the specified conditions.

Equity-oriented mutual fund units: Holding period: 12 months

Business trust units: Holding period:

• 12 months if listed; and
• 24 months if unlisted,

subject to the specified conditions.

Other units: Holding period:

• 12 months if listed; and
• 24 months if unlisted,

subject to the specified conditions.

Market-linked debentures

Market-linked debentures are treated as short-term capital assets under the prescribed framework.

The treatment of specified mutual funds and certain other securities is also subject to the conditions specified in the applicable provisions.

Cost of acquisition under SFT-2517

The framework also provides a methodology for estimating the cost of acquisition.

For purchases made on or after 1 February 2018, the weighted average transaction value is considered for the prescribed calculation.

For purchases made before 1 February 2018, the relevant end-of-day price available with the depository is considered in the circumstances specified by the framework.

For certain transactions, the estimated cost may be considered as nil.

This includes specified cases involving:

• Off-market purchases;
• Corporate actions; and
• Transactions carried out other than through an exchange.

For IPO allotments, the cost is determined using the prescribed formula based on the number of securities allotted and the allotment price.

Investments acquired before 1 February 2018

Special provisions apply to eligible long-term capital assets acquired before 1 February 2018.

For eligible equity shares, equity-oriented fund units and specified business trust units, the prescribed grandfathering provisions are considered while determining the acquisition cost.

The calculation involves the relevant comparison between:

• Original cost of acquisition;
• Fair market value as on 31 January 2018; and
• Sale consideration.

For listed securities, the prescribed fair market value is based on the relevant stock-exchange price.

Where there was no trading on 31 January 2018, the relevant price on the immediately preceding trading date is considered as prescribed.

Where the original acquisition cost is not readily available, the framework provides a mechanism for determining the adjusted acquisition cost.

Cost Inflation Index under SFT reporting

Where indexation is applicable, the Cost Inflation Index (CII) is used for determining the estimated indexed cost of acquisition.

The notification provides the CII for different financial years.

For example:

The CII should be applied only where indexation is applicable under the relevant tax provisions.

Off-market transaction reporting

A separate file is prescribed for reporting off-market transactions recorded by the depository.

The file captures information about both parties to the transfer and the security involved.

The information includes:

• Transfer date;
• Transferor DP ID;
• Transferor Client ID;
• Transferor PAN;
• Transferor name;
• Transferee DP ID;
• Transferee Client ID;
• Transferee PAN;
• Transferee name;
• Security class;
• Security code/ISIN;
• Security name;
• Quantity transferred;
• Reported consideration;
• End-of-day price;
• Estimated transaction value; and
• Reason for transfer.

The prescribed framework contains specific reason codes for different types of off-market transactions.

Important off-market transaction reason codes

The prescribed reason codes cover several types of transactions, including:

• Account closure;
• Transfer to beneficiaries;
• Certificate of deposit redemption;
• Depository receipt conversion;
• Commercial paper issuance;
• Dissolution or restructuring;
• Settlement of broker dues;
• Erroneous transfer;
• ESOP or employee transfer;
• Family transfer;
• PMS-related transfer;
• Gift or donation;
• Margin-related transactions;
• Minor and guardian transfers;
• Merger or demerger;
• Off-market sale;
• On-market sale;
• Open offer;
• Buy-back;
• Government or regulatory direction;
• Transfer to own account;
• Partner-firm or director-company transfers;
• Mutual fund redemption;
• Transposition; and
• Transmission to legal heirs.

Correct identification of the reason is important because an off-market transfer does not necessarily represent a taxable sale.

Control Statement under SFT-2517

A separate Control Statement is required as part of the reporting process.

The Control Statement includes information such as:

• Reporting entity name;
• ITDREIN;
• Registration number;
• Statement type;
• Statement number;
• Original statement ID;
• Reason for correction;
• Statement date;
• Reporting-period start date;
• Reporting-period end date;
• Number of records uploaded; and
• Aggregate values reported.

The designated person is required to verify the statement and certify the correctness and completeness of the information submitted.

Correction and deletion of SFT information

Errors may sometimes be discovered after an SFT has already been submitted.

The framework therefore provides mechanisms for correcting or deleting previously submitted information.

Correction Statement

A Correction Statement is filed when information previously reported needs to be corrected.

Only the records requiring correction are required to be included in the correction submission.

Deletion Statement

A Deletion Statement is used where previously submitted information needs to be removed.

The original statement is identified through the relevant statement ID.

The notification specifically states that correction or deletion mechanisms are available where previously submitted information needs to be modified or removed.

Reasons for correction

The prescribed correction codes include situations where:

• The original statement contained multiple errors;
• Errors are being corrected voluntarily;
• Additional information is subsequently being reported;
• The statement is a new statement/test-data submission; or
• Another specified reason applies.

The appropriate correction reason should be selected according to the actual circumstances.

SFT-2517 file format

The prescribed data files must follow the specified technical structure.

The framework requires:

• ASCII format;
• One report per line;
• Prescribed field delimiter;
• Header record in the file; and
• Prescribed field structure.

The reporting entity is required to generate the files from its internal systems and submit them using the designated SFTP server.

SFT-2517 validation rules

The data submitted through SFT is subject to validation.

The framework broadly categorises validation issues into three types:

1. Errors

These are technical or structural problems that need to be resolved before successful processing.

2. Defects

These indicate that the reporting entity needs to correct the relevant information and submit the corrected statement.

3. Exceptions

These require review by the reporting entity.

If the relevant information is available, it may be provided. If the review identifies an actual defect, corrective action is required.

The notification specifically identifies errors, defects and exceptions as separate validation categories.

Common SFT-2517 validation issues

Some of the validation checks include:

• Mismatch in Control Statement values;
• Incorrect sequence number;
• Missing account-summary information;
• Blank mandatory fields;
• Invalid PAN;
• Excessive values; and
• Mismatch with other submitted information.

These checks make internal reconciliation particularly important before uploading the final SFT data.

Information security requirements for SFT

SFT information may contain sensitive financial and personal information.

The reporting entity is therefore required to maintain appropriate information-security policies and procedures.

These should clearly establish:

• Responsibilities for handling SFT information;
• Security procedures;
• Protection of submitted information;
• Protection of related documents;
• Archival procedures; and
• Retrieval procedures.

Records should be capable of being retrieved promptly when required by the competent authorities.

SFT-2517 Compliance Checklist

Before submitting SFT-2517, reporting entities should consider the following checklist.

Account information

☐ PAN details verified
☐ Client names verified
☐ DP ID and Client ID verified
☐ Minor and guardian details checked
☐ Joint-holder information checked

Transaction information

☐ Transaction dates verified
☐ ISIN/security codes verified
☐ Security classification checked
☐ Market/off-market classification verified
☐ Quantity reconciled
☐ Sale consideration checked
☐ Acquisition cost checked
☐ FIFO matching completed
☐ Pre-1 February 2018 transactions separately reviewed
☐ Off-market transaction reasons correctly classified

Technical validation

☐ Sequence numbers are correct
☐ Mandatory fields are populated
☐ Account summary reconciles with transaction data
☐ Control Statement reconciles with uploaded files
☐ Validation errors have been resolved
☐ Exceptions have been reviewed

Post-filing

☐ Submission acknowledgement retained
☐ Data provided to account holders retained
☐ AIS reconciliation process followed
☐ Errors identified after submission reviewed
☐ Correction statement filed wherever necessary
☐ SFT records securely archived

SFT-2517: Key Points to Remember

The following points are particularly important:

SFT is filed twice a year

The reporting periods end on 30 September and 31 March, with due dates of 31 October and 30 April, respectively.

FIFO is important

Corresponding acquisition transactions are identified using the First-In-First-Out method.

Security classification matters

The applicable holding period depends on the type and status of the security.

Older investments require special attention

Transactions involving securities acquired before 1 February 2018 may require application of the prescribed grandfathering provisions.

Off-market transfers need proper classification

The prescribed transaction reason should be correctly identified.

Data must be reconciled

The transaction summary, account summary and control statement should agree before filing.

Corrections are possible

Errors discovered after filing can be addressed through the prescribed correction mechanism.

Security and record retention are part of compliance

Reporting entities need appropriate procedures for securing, archiving and retrieving SFT information.

Frequently Asked Questions on SFT-2517

What is SFT-2517?

SFT-2517 is the prescribed Statement of Financial Transactions reporting framework for relevant depository transactions. It captures specified securities transaction information for reporting to the Income Tax Department.

What is the due date for SFT-2517?

For the period 1 April to 30 September, the due date is 31 October.

For the period 1 October to 31 March, the due date is 30 April.

How often is SFT-2517 filed?

SFT-2517 is required to be reported on a half-yearly basis.

Who is required to file SFT-2517?

The notification specifically covers Depositories as defined under the Depositories Act, 1996.

What is FIFO in SFT reporting?

FIFO means First-In-First-Out. The earliest corresponding acquisition is generally matched with the subsequent sale/debit transaction.

What is the purpose of SFT reporting?

SFT information is used by the Income Tax Department for financial transaction reporting and can assist with AIS and pre-filling of income-tax returns.

Can SFT information be corrected after filing?

Yes. A prescribed Correction Statement can be submitted when previously reported information needs to be corrected. A deletion mechanism is also available for information that needs to be removed.

What happens if the SFT file fails validation?

The reporting entity needs to review the validation result. Depending on the nature of the issue, it may need to correct errors, rectify defects or review exceptions before completing the reporting process.

Conclusion

The SFT-2517 framework creates a structured reporting mechanism for depository transactions and provides the Income Tax Department with detailed information relating to securities held and transferred through demat accounts.

For reporting entities, compliance involves much more than simply uploading a file. The underlying data needs to be accurate, complete, properly classified, reconciled and technically validated.

Particular attention should be given to FIFO matching, security classification, acquisition cost, transactions involving assets acquired before 1 February 2018, off-market transfers, control-statement reconciliation and post-filing corrections.

For taxpayers, SFT reporting is equally relevant because information reported to the Income Tax Department may be reflected in AIS and may be used for income-tax return pre-filling.

Maintaining proper records and reconciling demat statements, broker statements, AIS and tax computations can help identify discrepancies before the income-tax return is filed.

Disclaimer

This article is intended for general educational and informational purposes. It is an independently written explanation of the SFT-2517 reporting framework and should not be considered a substitute for the applicable Income-tax Act, Income-tax Rules, CBDT notifications, prescribed technical specifications or professional advice. The law and reporting requirements applicable to a particular transaction should be independently examined before taking any compliance decision.

Notification No. 1 of 2026

Also Read: “CBDT Notifies New Forms PAN CR-01 & PAN CR-02 for PAN Correction from 1 April 2026”

Also Read: FAQs and Guidance notes on Forms under Income-tax Rules, 2026

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