26AS Form Information List to Include Foreign Remittances, Mutual Funds
Form 26AS is an annual consolidated tax return that taxpayers can access from the Income Tax Department website using their Permanent Account Number (PAN). The decision to add more information to the document is likely to facilitate anonymous reviews.
On October 26, the Central Council of Direct Taxes (CBDT) issued an order under Section 285BB of the Information Technology Act expanding the scope of information reported in the new 26AS form.
Section 285BB has been added to Income Tax Law in Union Budget 2020-21, to transform Form 26AS into an ‘Annual Information Statement’, which in addition to TDS / TCS details , would contain complete information on the specified financial transactions, payment of taxes, claim / refund and pending / completed procedures undertaken by a taxpayer during a particular financial year which must be mentioned in the tax returns.
As a result, in May of last year, the Income Tax Service notified the revised Form 26AS, including information on large-value financial transactions made during a fiscal year, a decision which also facilitated voluntary compliance and ease of electronic filing of tax returns. .
With this order of October 26, the list of details available in Form 26AS has been further expanded.
Additional information recommended by the direct tax authority includes overseas remittances made by anyone through an authorized reseller, salary breakdown with deductions claimed by the employee, information in the RTI other taxpayers, interest on the refund of income tax, information published in the financial statement Transactions.
In addition, off-market transactions reported by custodian / registrar and transfer agent, mutual fund dividend information reported by RTA, and mutual fund purchase information reported by RTA also would be included in Form 26AS.
The CBDT has authorized the “Director General of Income Tax (Systems) to upload the information … in his possession, in the annual information declaration to form 26AS in the electronic filing account registered by the assessor in the designated portal, within three months from the end of the month in which the information reached it. “
As a result of this development, AMRG & Associates (Director – Direct and International Taxation) Om Rajpurohit told the PTI news agency that the additional information to be loaded on the annual disclosure statement in the 26AS form would promote ease of reporting. faceless digital assessments.
“Even if the additional tax contributions from taxpayers would be insignificant, the cumulative effect would be remarkable. This change will push all taxpayers towards accurate and accurate self-reporting of earned income, ”Rajpurohit said.
Nangia & Co LLP partner Shailesh Kumar said the new Form 26AS will now contain details of foreign remittances made by the taxpayer, as indicated by the authorized dealer in Form 15CC, more complete details on the allowances, deductions claimed by taxpayers in respect of their wage income as declared. to the employer.
“This new report in Form 26AS will help both taxpayers and tax authorities assess a taxpayer’s profile and improve the flow of information between taxpayer and tax authorities,” Kumar said.
“With all the information / details available in one place, it will also help the tax authorities to perform an electronic assessment and not have any interaction / limitation with the taxpayers, as the tax authorities can easily compare the information available in the form. 26AS vis-à-vis the information declared by the taxpayer in the ITR and any discrepancies can be easily reported by the systems to the tax authorities, ”he added.
It will also help taxpayers to identify and take corrective action, in the event that incorrect information / details are reported in the 26AS form, he added.
During the redesign of Form 26AS, CBDT said last year that the IT department receives information such as cash deposits / withdrawals from savings bank accounts, sale / purchase of real estate, credit card payments, purchase of stocks, bonds, foreign currencies, mutual funds, cash payment for goods and services since fiscal 2016.
From now on, all this information under different Financial Transaction Statements (SFT) will be displayed in the new 26AS form.
The information received by the Department from the filers of these specified SFTs is now displayed in Part E of Form 26AS to facilitate voluntary compliance, fiscal responsibility and ease of electronic filing of returns so that the taxpayer can use them to file their tax return. tax return by calculating the correct tax payable in a wellness environment.
Part E of the form also presents various fields such as the type of transaction, the name of the SFT declarant, the date of the transaction, the single / joint party transaction, the number of parties, the amount, the method of payment and the remarks, etc.
AKM Global, Tax and Regulatory Director, Sandeep Sehgal said that in recent years Form 26AS has become more comprehensive in terms of information available to a taxpayer on withheld taxes and other financial information. According to the latest order, additional details would be gathered from various sources and be available.
“The idea seems to make it a must-have document for taxpayers to have almost everything in one place, from basic tax deductions to other important details, so compliance requirements can be met hassle-free,” Sehgal added. .
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