Let X be a complete toric variety equipped with the action of a torus T , and G be a reductive algebraic group, defined over C. We introduce the notion of a compatible Σ-filtered algebra associated to X, generalizing the notion of a compatible Σ-filtered vector space due to Klyachko. We combine Klyachko's classification of T -equivariant vector bundles on X with Nori's Tannakian approach to principal G-bundles, to give an equivalence of categories between T -equivariant principal G-bundles on X and certain compatible Σ-filtered algebras associated to X.