What is the Form 26AS?
The income tax department is working hard to abolish the culture of tax evasion in India. There are various tools and forms have been introduced to ensure transparency in the income tax return filing system in the country.
Recently, the Income Tax Department has launched a revised 'Form 26AS' or Annual Information Statement from this assessment year 2020-21. This form will show details of all high-value transactions made by the taxpayers.
Now let us read more about this new Form 26AS.
What is the Form 26as?
Form 26AS contains information about the tax you paid to the government.If you have paid tax on your income or any person/institution has deducted tax on your earnings, then you also need to mention it in Form 26AS. So You can know details about your income and tax with the help of Form 26AS.
Form 26AS is your annual tax statement. You can find it from the website of the income tax department with the help of your PAN number. This form will reflect details of all high-value transactions made by the taxpayers. Earlier the tax authorities used to get this information from the financial institutions.
Hence Form 26AS is a consolidated annual tax statement that includes information on tax collected/deducted at source, self-assessment, and advance tax.
Why Form 26AS launched?
The Finance Minister had announced about the Form 26AS in the Budget 2020-21. The basic intention behind its introduction is to fetch information about the transactions of higher values.
The Central Board of Direct Taxes (CBDT) said the Income Tax Department used to receive higher value information like sale/purchase of immovable property, cash deposit/withdrawal from saving bank accounts, purchase of shares, buyback of shares, debentures, time deposits, foreign currency, credit card payments, purchase of mutual funds, cash payment for goods and services, etc. from “specified institutions” like banks, registrars or sub-registrars, mutual funds, and bonds issuing institutions.
Now, all such information under the different specified transactions will be shown in the new Form 26AS.
After the introduction of this form 26AS; the income tax authority will come to know record details of;
1. Transactions involving cash deposits aggregating to Rs 10 lakh or more in a financial year.
2. Cash payments made by any person totaling over Rs 1 lakh in a financial year.
3. Payments of bills of one or more credit cards of Rs 10 lakh and above by a person in a financial year.
4. Investment in mutual funds, debentures/bond, shares, buyback of shares exceeding Rs 10 lakh in a financial year.
5. Sale or purchase of immovable property for Rs 30 lakh or more in a financial year.
So the introduction of Form 26AS is another effort of the government to terminate the practice of tax evasion in the country. Now we have to wait and watch to know the real impacts of this form.