ICAI News – The Institute of Chartered Accountants of India has announced major relief for the family & legal heirs of deceased Chartered Accountants. On July 25th, 2026, the ICAI Council decided to extend the time allowed for transferring the goodwill of a deceased member’s proprietary firm. Now, families & representatives get three years from the date of death instead of just one year.
This update affects the goodwill rules in Volume I of the ICAI Code of Ethics, 2026. ICAI announced that the old one-year limit is now extended to three years.
What does the new rule mean?
Earlier, the transfer of goodwill of a deceased CA’s proprietary firm was subject to a one-year limit. The new three-year period gives the family more time to complete legal formalities and find an eligible Chartered Accountant to purchase the goodwill.
ICAI’s Code of Ethics permits goodwill of a proprietary CA firm to be transferred to another eligible ICAI member. The Code says this framework was introduced to reduce hardship faced by families after the death of proprietors.
Who are legal heirs for this purpose?
ICAI identifies the spouse, child or children, and parents as legal heirs for this goodwill transfer procedure.
What documents are required?
The purchasing member must hold a Certificate of Practice. The procedure includes an application, death certificate, draft sale deed and legal-heir proof such as a succession certificate, Will, legal heir certificate or affidavit. If one legal heir signs the agreement, NOCs from other legal heirs are generally required. The purchaser must also publish an advertisement inviting objections. After ICAI approves the transfer, Form 18 must be filed within 30 days.
Important clarification
The July 25 announcement increases the goodwill transfer time limit to three years. However, it does not separately state whether cases where the earlier one-year period had already expired are automatically revived. Such cases may need further ICAI clarification.
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