CBDT’s new Form 26AS will remind taxpayers to file major financial transactions

The Central Board of Direct Taxes (CBDT) has launched a brand new auto-generated ‘Form 26AS’ which is able to handhold taxpayers whereas submitting their ITRs in a faceless method from the present evaluation yr , an official assertion stated.

The new type has been launched to make sure that taxpayers will now not overlook to say main monetary transactions corresponding to money deposits and withdrawals, investments in shares and mutual funds, and property transactions of their annual income-tax returns (ITRs).

Form 26AS is an auto-generated monetary assertion that features taxation-related info, together with particulars of high-value transactions. The type earlier used to present restricted info associated to tax deducted at supply (TDS) and tax collected at supply (TCS) apart from sure further info together with particulars of different taxes paid, refunds and TDS defaults.

The CBDT defined that the earnings tax division already receives info corresponding to money deposit and withdrawal from saving financial institution accounts, sale and buy of immovable property, time deposits, bank card funds, buy of shares, debentures, international foreign money, mutual funds, purchase again of shares, money cost for items and companies as per the Income-Tax Act since 2016.

“Now all such information under different SFTs [Statement of Financial Transactions] will be shown in the Form 26AS,” the assertion stated.

A finance ministry official requesting anonymity stated, the faceless system goals to handhold taxpayers for ease of submitting returns. It can even scale back litigations as real taxpayers is not going to miss submitting any transaction of their ITRs. Besides, it is going to nudge such taxpayers who have a tendency to hide these particulars to make full disclosures.

Archit Gupta, founder and CEO at ClearTax stated the transfer will present entry to each filers in addition to the federal government to the taxpayer’s full record of monetary transactions. “In the near future, details of financial transactions related to the stock markets may also be included,” he stated.

ClearTax is a monetary know-how platform offering tax and investment-related options.

According to Gupta, ‘Form 26AS’ earlier had an Annual Information Report (AIR) of transactions. Now, it is going to have particulars of Significant Financial Transaction (SFT). “Taxpayers will have access to details of all SFT filed by specified entities against their PAN (permanent account number),” he stated.

CBDT stated that the ‘Form 26AS’ for any taxpayer will now show fields corresponding to kind of transaction, identify of SFT filer, date of transaction, single or joint get together transaction, variety of events, quantity, mode of cost and remarks.

Gopal Bohra, associate at tax consultancy agency NA Shah Associates LLP stated, “The new form will enable the taxpayer to have all important information available while preparing the tax return so that the chances of committing any error will reduce significantly.”

According to Pranjal Kamra, the CEO of authorized and monetary service agency Finology, the brand new type has enlarged the scope of reporting to incorporate monetary transactions corresponding to sale of shares, redemption of mutual funds and sale of property. “This would not only facilitate reportings but would also desist those taxpayers who inadvertently conceal financial transactions while filing their IT returns.”

“The government is putting all its effort to make the economy transparent and to curb all the illegitimate financial transactions. The introduction of new form 26AS is a massive step forward in this direction,” stated Kapil Rana, chartered accountant and founding father of HostBooks Ltd, a cloud-based accounting platform.