ANNUAL INFORMATION STATEMENT

ANNUAL INFORMATION STATEMENT

The Income-Tax Department has rolled out a new Annual Information Statement (AIS), which includes additional categories of information.

The facility can be accessed by visiting the online portal link of the Annual Information Statement (AIS) under the Services tab on the tax e-filing portal.

At present, Form 26AS is detailed by the Tax Department, which is a consolidated annual tax statement that includes information on TDS/ TCS, advance tax, and self-assessment. It is available on the Income-Tax website against a taxpayer’s PAN.

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The revised AIS includes additional categories of information – on interest, dividend, securities transactions, mutual fund transactions, and remittances from abroad, along with information on many other transactions that are at present available with the IT Department.

“There may be other transactions relating to the taxpayer which are not presently displayed in the AIS,” the I-T Department has said.

With the help of AIS, Taxpayers can view the information, report, and accurate data in the Income Tax Return.

Taxpayers just need to carefully check all transactions reflected in the AIS, so that correct information is then reflected in their returns.
With the revised AIS, most transactions are now under the purview of the I-T Department.

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The Department has said it also has access to information beyond what is being shown in the AIS, which will help tax authorities to assess a taxpayer’s profile comprehensively and reduce the scope of evasion.

The department has offered the convenience of feedback, which will ensure correction of any anomaly before a taxpayer files their returns. The ability to submit online feedback will help remove any duplicate and incorrect transactions.

15G Exempts TDS on Taxable Income below a threshold limit!

15G Exempts TDS on Taxable Income below a threshold limit!

Form 15G can be filed with the prescribed financial institution if the individual’s total income is less than the basic exemption amount.

Where interest income from time deposits with prescribed financial institutions for a financial year (FY) exceeds the required maximum (currently 40,000), TDS at the applicable rate is deducted, according to the rules of the Income Tax Act.

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When an individual’s total income is less than the basic exemption limit, he or she can file Form 15G with a prescribed financial institution (such as a bank) to request that no taxes be withheld from the interest income made on the deposits.

Furthermore, if the tax rate at which the total income is subject to tax is NIL or lower than the rate at which the TDS is deducted (regardless of any advance tax paid by the recipient of income), the recipient of income may apply to the jurisdictional tax officer in the prescribed form for a lower or NIL deduction certificate (LDC). Following an examination of the appropriate papers, the tax officer may issue an LDC indicating a lower rate of TDS deduction at his or her discretion. TDS will be deducted at the rate provided in the LDC in this circumstance.

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Separately, take notice of the following from the perspective of the timing of taxation of such income. The interest income you receive from recurring deposits is taxed under the heading “income from other sources” (IFOS) according to the accounting system you use on a regular basis (i.e. mercantile/cash basis).

As a result, if you have previously offered interest income or revenue from other sources on an accrual/receipt basis, you might use the same approach for income from these RDs. The interest income will be taxed at the slab rates that apply to you for the fiscal year in which it is received. Any TDS already deducted by the bank on these deposits during the relevant FY will be credited against the income tax you owe for that year. If the amount of taxes deducted at source is less than the appropriate tax rate, you must pay the difference in advance tax in the specified instalments.

Have you forgotten to double-check your tax return? Carry it out.

Have you forgotten to double-check your tax return? Carry it out

While ITRs can be validated electronically in five different methods, a physical copy can also be sent to Bengaluru’s Centralized Processing Centre (CPC).

One of the most significant financial tasks of the year is the filing of income tax returns. It’s critical that you file your income tax return on or before the deadline, with complete and correct information about your earnings and any other information requested on the ITR form. The deadline for reporting ITRs for FY2020-21 is December 31, 2021.

ITR verification is the final step in the income tax return filing process. The ITR must be confirmed within 120 days of the filing date, according to income tax legislation. A taxpayer has six options for verifying their return. While ITRs can be validated electronically in five different methods, a physical copy can also be sent to the Centralized Processing Centre for verification (CPC), Bengaluru.

Note that if an ITR is not confirmed within 120 days of filing, the income tax authorities will not consider it a genuine return. Furthermore, if the ITR is not confirmed, it will not be accepted for processing by the tax department. Furthermore, taxpayers will not receive any tax refund unless they have filed a validated ITR that has been confirmed by the income tax department after processing.

What to do if the ITR isn’t confirmed within the allotted time:

An individual can file a condonation delay request on the e-filing income tax site if an ITR was not verified within the statutory time limit owing to a legitimate reason. They will be asked to explain why the ITR was not confirmed earlier when filing such a request. If specific circumstances are met, the income tax department will grant a request for a deferral in payment. The following are some of the criteria:

  • A claim is true and accurate;
  • In the hands of another individual, income for which a tax return has been submitted is not assessable;
  • The taxpayer is experiencing genuine hardship as a result of the ITR not being confirmed in a timely manner.

If you have failed to verify your tax return, here’s how you can file condonation delay request:

Step 1: Login to your account on the income tax portal.
Step 2: Under the ‘Services’ tab on your Dashboard, select ‘Condonation Request’.
Step 3: On the ‘Condonation Request page’, select the type of condonation request you want to proceed with. (Currently income tax department shows only one option: Delay in submission of ITR-V). Select it and click on ‘Continue’.
Step 4: On the ‘Delay in submission of ITR-V’ page, click on ‘Create Condonation Request’.
Step 5: On the ‘Select ITR page’, select the record for which you want to raise a condonation request for delay in ITR-V submission and click on ‘Continue’.
Step 6: On the ‘Provide reason for delay page’, select the reason of your delay and click on Submit.

Step 5: On the ‘Select ITR page,’ select the record for which you want to submit an ITR-V delay condonation request and click ‘Continue.’
Step 6: Select the cause for your delay on the ‘Provide explanation for delay page’ and click Submit.

A success notification will appear, along with a Transaction ID. Make a mental note of the Transaction ID for future use. A confirmation message will be sent to the email address and mobile number you provided when you registered with the e-Filing portal.

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Keep in mind that there is no explicit provision in the Income Tax Act that specifies a time restriction for filing a condonation delay request. However, the CBDT has stated in Circular No. 9/2015 dated June 9, 2015 that no condonation application for a refund/loss claim will be considered after six years from the end of the assessment year for which the application/claim is lodged.

How to keep track of a delay condonation application’s progress:

Through the new income tax site, you can quickly check the status of your condonation request. The ‘Condonation Request’ option under the ‘Services’ tab can be used to track the status. You will not be able to file an ITR until your delay condonation request is approved. While there is no set timeframe for acceptance or denial of a condonation request, the tax department typically processes such requests in 3 to 4 months.

What if your request for a condonation delay is denied?

If the application is denied, the return will remain unverified, and a non-verified return is viewed as an invalid return under income tax regulations, meaning the individual will be responsible for all of the repercussions of failing to file a tax return. If the assessee’s request for a condonation is denied, they will be liable to criminal sanctions under the IT law.

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Consequences of failing to file an ITR:

  • Section 234F imposes late filing fines of Rs 5,000. However, if the taxpayer’s total income is less than Rs 5 lakh, late costs are limited to Rs 1,000.
  • In addition, any amount of tax that remains unpaid would be subject to interest at 1% per month or part of a month under section 234A.
  • Due to non-filing of the tax return within the statutory due dates, the opportunity to claim certain deductions and/or set off and carry forward of losses other than losses from house property loss is lost.
  • The Internal Revenue Service (IRS) can charge a penalty under 270A for under-reporting income, which is equal to 50% of the tax saved by the taxpayer due to non-filing of a return.
  • The taxman can also bring a case against the defaulting taxpayer under section 276CC, which can result in a sentence of rigorous imprisonment for a period ranging from three months to two years, as well as a fine, based on the amount of tax avoided.