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| « Clarification in relation to notification issued under... | Check fine for late filing and misreporting income Income... » |
High value transactions, other details that your tax passbook will show Form 26AS |
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| July, 28th 2020 |
1. What is the Form 26AS?
This is a statement from the tax department which mentions the tax deducted on behalf of a taxpayer. It also mentions income for which an individual might have sought tax exemption during the year. All taxpayers are given a Form 26AS.
2. How do I access my Form 26AS?
You can log in to your tax filing account and view it. You can also access it through your Netbanking account if the account is linked to your PAN.
3. What is new this year?
From this year, the Form 26AS has a new Section E which mentions specified high-value transactions conducted by an individual during the financial year. These transactions include:a) Open FDs of more than Rs 10 lakhb) Pay credit card bill of more than Rs 10 lakh by cheque and more than Rs 1 lakh by cashc) Buy bonds of more than Rs 10 lakhd) Buy mutual funds of more than Rs 10 lakhe) Buy shares of more than Rs 10 lakhf) Offer shares for buyback of more than Rs 10 lakhg) Buy foreign exchange of more than Rs 10 lakhh) Buy property worth more than Rs 30 lakhi) Get bank drafts made of more than Rs 10 lakh with cashj) Deposit more than Rs 10 lakh in cash in savings bank accountk) Deposit or withdraw more than Rs 10 lakh in cash from current account
4. Are these amounts per transaction or cumulative?These are cumulative amounts. You could be doing separate transactions, but the total amount for the financial year will be taken into account. For instance, if you have SIPs of Rs 10,000 in 10 different funds, the entire Rs 12 lakh invested in a year will get reported.
5. But these transactions are not illegal...Certainly not. These are perfectly legal transactions and the taxpayer will not be penalised in any way. It’s only that these amounts should be mentioned in the tax return filed by the individual. Also, they should obviously match the income declared in the tax return filed by the assessee. A person claiming to have income less than Rs 5 lakh a year will obviously not be able to spend Rs 12 lakh on his credit card.
6. What about people who do intraday trading? They buy and sell securities worth Rs 1 lakh in a day.
This will apply only to purchase and sale of shares in the cash market. Intra-day transactions will not get captured in the Form 26AS, though the tax department does know about those deals too.
7. So taxpayers should be wary from now on.It is new, but this Section E will be mentioned in the Form 26AS of previous years as well.
8. What does this mean for honest taxpayers?Honest taxpayers don’t have to worry. In one way, it is actually beneficial for them. If they have conducted any such transaction it will show up in their Form 26AS. All they have to do is mention it in the ITR, which will ensure they file an error-free return.
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