New Form 26AS: Taxpayers have to be Honest, Not By Choice but by COMPULSION now

Loading

New Form 26AS: Taxpayers have to be Honest, Not By Choice but by COMPULSION now

Form.26AS is a statement of the taxpayers wherein tax related & high value information of the taxpayers is available on a year on year basis. Now, Form 26AS has almost removed the requirements of maintaining physical Copy

  1. Tax Deduction Certificates
  2. TCS Certificate
  3. Advance Tax Challan
  4. Self Assessment Tax Challan
  5. Details of income tax refund

The scope of 26AS has been widened so as to provide further details of data of assessee available with the income tax department. 26AS showS various other information & details of the taxpayers. Form 26AS has two parts, Part A & Part B. Part A gives basic details of the assessee whereas Part-B shall consists of the following

Nature of information
Information relating to tax deducted or collected at source
Information relating to specified financial transaction
Information relating to payment of taxes
Information relating to demand and refund
Information relating to pending proceedings
Information relating to completed proceedings

It also contains the information related to transactions specified in secs.90 and 91 (i.e., international transactions).

One of the key features in 26AS is related to the Specified Financial Transactions (SFT). As of now, following are the Specified Financial Transactions which are collected by the department and the same is going to form the part of the 26AS.

Transactions Reporting entity & Threshold Limit thereto
Cash Deposits in a year in Bank (other than Current A/c) All Banks – Rs.10 lakhs per year
Fixed Deposits All Banks, Post-Offices, Nidhi Companies – Rs.10 lakhs per year
Cash Deposits/ Withdrawals in a year in Bank (Current A/c) All Banks – Rs.50 lakhs per year
Credit Card Payments All Banks or Credit Card Issuing companies – Rs. 1 lakh in Cash and Rs.10 lakh by a mode other than cash
Share Application Money/Investment in Shares OR Bonds OR Buy-back of Shares Company issuing Shares or Bonds or Listed Company buying back – Rs. 10 lakhs
Investment in Units Trustee of MF – Rs. 10 lakhs
Receipts for issue of Foreign Exchange or Traveler’s Cheques Authorised Money changer under FEMA/ Rs. 10 lakhs in one FY
Receipts from persons for purchases in cash Assessee covered by Sec.44AB –

Rs.2 lakhs, in a FY

The scope of SFT is proposed to be widened and the same will thereafter form the part of 26AS. The new transactions would be

  1.  Payments to Hotels above Rs. 20,000
  2. Payments of Property Taxes above Rs.20,000
  3. Payment of Health Insurance Premia above Rs.20,000
  4. Payment of Rent above Rs.40,000
  5. Life insurance premium over Rs.50,000
  6. Electricity Charges paid above Rs.1 lakh
  7. Fee for Educational institutions,  Donations above Rs.1 lakh
  8. Purchase of Jewellery, white goods, paints, Marble etc. above Rs.1 lakh
  9. Business class air travel in business class or foreign travel
  10. Share transactions/DEMAT Accounts/Bank Lockers
  11. Travel by air and foreign travel

With above additional information availability with the income tax department and the assessee, tax compliance is going to be more daunting and tough. There will be matching of income with the investments, expenses and other transactions of the assessee. It will result in more focused analysis of the taxpayers profile with investment & expenditure and income thereto to the assessee.

The information sought is micro level information and with this, the department is set to have the 360 degree profile of the taxpayers. The information is not one time information but a regular information and in years to come, the information is going to be used by the I.T. System to make a system driven detailed study of the taxpayers track record. The information will be available with the income tax department not for 1 or 5 years but will be there for multiple years. The data interlinking of the data with other departments will further intensify the availability of the data with the tax department.

With this, the taxpayers have to be honest not by choice but by compulsion.

***********************************************

Income Tax Act on Your Mobile Now Android Application For Income Tax Act – 1961 with Cost Inflation Index and other tools on Mobile now at following link:

https://play.google.com/store/apps/details?id=com.thetaxtalk&hl

***********************************************

Whatsapp Group at

  1. https://chat.whatsapp.com/LmzMXJ5HeM6IAEfpbZYooK
  1. https://chat.whatsapp.com/EBltaQ8GKIhAmpxAqVyj4L

***********************************************

Menu