HR and payroll compliance for Indian businesses
September 2025: Employment Law Changes That Affect You
Welcome to the September 2025 compliance update. Below is a clear summary of the most important employment-law and tax changes that may affect your HR, payroll and compliance work this month.
At a glance — key changes this month
- EPFO launches a revised electronic challan and return (ECR) system with a 4 month transition period.
- PF settlement claims to be paid on a part-payment basis instead of being rejected.
- Income-tax audit report filing deadline extended for AY 2025–26.
- No Professional Tax slab changes verified this month.
1. EPFO revamps electronic challan system
Effective: September 2025 wage month
Authority: EPFO
EPFO has introduced major structural changes to the monthly ECR filing process. Employers must file in the new format starting with September 2025. Three new return types — Regular, Supplementary and Revised — are now available.
What employers should do
- Use the new return types from September payroll filings.
- Use the 4 month transition period to fix old return issues.
- Check member pension eligibility and age validations.
2. EPFO directs part-payment for PF final claims
Effective: Immediate • Authority: EPFO
EPFO has issued a directive requiring field offices to process PF final settlement claims through part-payment rather than rejection when contributions or transfer-ins are pending.
What employers should do
- Clear pending contributions or arrears quickly.
- Ensure transfer-in requests are closed for exiting employees.
- Update internal exit procedures to reflect part-payment rules.
3. Income tax audit report deadline extended
Authority: CBDT • Press Release: 25 September 2025
CBDT has extended the audit report filing deadline for AY 2025–26. This applies to companies and businesses requiring Form 3CD and related disclosures.
What employers should do
- Update the compliance calendar with the new due date.
- Work with auditors to meet the revised deadlines.
- Ensure e-filing schedules are updated across finance teams.
4. Professional Tax — no updates this month
A review of official state portals from 15 September to 13 October shows no new PT slab changes, notifications or filing-rule adjustments. Offrd will continue monitoring.
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