Implementation of Form 26AS of Income Tax

On 18July20, Income Tax Dept announced the implementation of the new 26AS form.

What is Form 26AS Form?

Till now Form 26AS, was a statement that the IT department used to provide u to capture

a)TDS deducted from U (example: Your company deducting TDS on your  salary)

(b) TCS: Tax collected at source (house property etc)

updated form 26as
Updates in New Form 26AS are:-

In News Form 26AS will contain new Section known as Section E. In this Section it will capture certain high-value transactions that you have made during the financial year. So at a glance, it’s going to help u see you large transations in a year.

For example transaticon which includes in this are:-

  • If you invest in a mutual fund of more than 10 lacs per year. This is a big transaction and it’s going to be captured in this statement
  • Fixed deposits in banks more than 10 lacs in a year
  • Credit Card Bills more than 10 lacs (in one year) if paid by check and more than 1 lacs if paid in cash
  • If you buy bonds more than 10 lacs in a year
  • If you buy shares more than 10 lacs in a year
  • If you buy Fx more than 10 lacs a year
  • If you buy MFs more than 10 lacs in a year
  • Purchase of Bank drafts more than 10 lacs in cash
  • If you deposit cash in savings bank account more than 10 lacs
  • Cash deposts or withdrawals from current account more than 10 lacs

This Section E will also be shown in your Form 26AS of pervious year also

form 26as
How will this Form 26AS will impact us?

This is potentially helpful to honest tax payers. Now we’ve got a single point source of all the major txns that will help us out. For those who evaded taxes-as IT departments already knew earlier-it now throws it in their face and says IT knows

So does thismean you should do transaction less than 10 lacs. For eg: Make a FD less than 10 lacs or split it to keep those below 10 lakh?

First thing, this is not a single value of transaction.y Anyhow, all your FDs (or other Txns as detailed above) will be cumulatively (in a single bank) looked at, So there’s no point trying to make smaller txns or splitting them.

Whether you need to worry of  IT departments if you spend too much on credit cards?

Again, honest tax payers need not worry of this. Yet if someone doesn’t pay taxes that claim negligible income yet spends more than 10 lacs, IT department is sure to ask him how much he can spend Or for example: if you say u have negligible income in your tax return and make FDs in Bank of more than 10 lacs or invest in MFs more than 10 lacs, be ready for Q on without income, how can u save so much

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