CA Final · September 2025 · Paper 4
CA Final Direct Tax Laws & International Taxation September 2025: paper analysis
Our own analysis of the official paper, as of 12 October 2026. The questions and answers belong to ICAI; read them on ICAI's website.
Chapter-wise marks
Where the marks were in this paper (out of 100; internal-choice alternatives not double counted).
What each question tested
In our words, by question number. Open the official paper for the full question.
| Q | Marks | Tests | Chapter |
|---|---|---|---|
| 1 | 14 | Total income of a manufacturing company with business adjustments, foreign exchange hedging, employment-linked deduction and transfer of land to a group company | Profits and Gains of Business or Profession |
| 2(a)(i) | 4 | Tax liability of an association of persons and a member where members follow different tax regimes | Assessment of Various Entities |
| 2(a)(ii) | 4 | Shareholder taxation on a share buyback and on receipt of assets in a company liquidation | Capital Gains |
| 2(b) | 6 | Total income and tax of a foreign institutional investor on securities gains and investment income | Non Resident Taxation |
| 3(a) | 8 | Total income of a charitable trust: application of income, accumulated amounts and corpus-funded expenditure | Assessment of Trusts and Institutions, Political Parties and Other Special Entities |
| 3(b) | 6 | Total income and tax of a resident salaried individual with foreign income from a non-treaty country, including unilateral relief | Double Taxation Relief |
| 4(a)(i) | 3 | TDS on purchase of a built-up flat by joint buyers, including amenities forming part of consideration | Deduction, Collection and Recovery of Tax |
| 4(a)(ii) | 3 | Employer's TDS on salary considering other income, house property loss and TCS declared by the employee | Deduction, Collection and Recovery of Tax |
| 4(a)(iii) | 2 | TDS obligations on interest and cash withdrawals of a co-operative bank dealing with another bank | Deduction, Collection and Recovery of Tax |
| 4(b) | 6 | Associated enterprise test based on shareholding, and options after accepting a transfer pricing adjustment | Transfer Pricing |
| 5(a)(i) | 4 | Limitation for a revision order by the Commissioner reckoned from date of passing versus date of service | Appeals and Revision |
| 5(a)(ii) | 4 | Validity of reassessment proceedings when rectification is time-barred and pending | Assessment Procedure |
| 5(a)(iii) | 4 | Whether a tax-exempt trust can be treated as an assessee in default for failure to deduct tax on rent | Deduction, Collection and Recovery of Tax |
| 5(b) | 3 | Need for and objective of principles of interpretation when interpreting tax treaties | Application and Interpretation of Tax Treaties |
| 5(c) | 3 | Indicators of BEPS activity recommended under the measurement and monitoring action plan | Fundamentals of BEPS |
| 6(a) | 6 | Tax auditor's reporting on interest limitation for debt from a non-resident associated enterprise via a back-to-back deposit | Tax Audit and Ethical Compliances |
| 6(b) | 4 | Distinguishing tax planning, tax compliance and tax evasion in given fact patterns | Tax Planning, Tax Avoidance and Tax Evasion |
| 6(c) | 4 | Withdrawal of an advance ruling application and time limit for pronouncing the ruling | Advance Rulings |
What stood out
- Business income again anchored the paper through a 14-mark corporate computation including MSME payment timing, hedging gains and employment-linked deductions.
- A case built around a business trust and its unit holders carried 10 MCQ marks, testing distribution taxation, withholding and residential status; an area that is easy to skip.
- TDS questions were worth 14 marks overall, with property purchase by joint buyers, salary TDS under the default regime and assessee-in-default for exempt trusts.
- Penalty provisions for under-reporting and false entries appeared in the MCQs, reinforcing that penalty and procedure rules need precise recall.
- International taxation was spread across non-resident and FII taxation, foreign tax credit, transfer pricing, treaty interpretation and BEPS Action 11 in roughly equal measure.
Practise the chapters that carried the marks
Assessment of Trusts and Institutions, Political Parties and Other Special Entities, Profits and Gains of Business or Profession, Deduction, Collection and Recovery of Tax: study guides and practice questions in the CA Final format.