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

Recent Post:-

Tax Compliance Due date- Updates

1. Income tax all pending 80C investments for the Financial Year 2019-20, in PPF Mutual Funds FD LIC etc can be made till 30th June 2020

2. TDS payment for the mth of March 20 need to be made before 30th April itself however return due date for Q4 id 30th June 2020

If paid after 30th April, there will be interest liability @9% pa.

3. GST returns

For, Monthly and Quarterly returns in Form GSTR 1 – No late fee or interest and due date is 30th June 2020 (return period March April and May)

For Mthly GSTR 3B returns the due dates are shifted to 30th June 2020

However, for cos. or entities above 5cr turnover payment delay of more than 15 days will attract int @9%

roc due dates

4. ROC due dates :-

DIR3 kyc for Directors – 30th April 2020
MSME form – 30th April 2020
Form 11 for LLP – 30 th May 2020
DPT 3 return – 30th June 2020

5.Yearly PTEC payments (Prof. Tax) of 2500 due on 30.06.2020

6. GST annual return and Audit for FY 18-19 in Form GSTR 9 and 9C – 30.06.2020

7. All existing trusts need to re-register under Income tax 12AB and 80G before 31st Aug 2020

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Lower TDS certificate

Application for the NIL / Lower TDS Deduction Certificate for FY 2020-21 may be made from 28 February 2020.

Under the provisions of the Income Tax Act, deduction of tax deducted at Sources (TDS) is mandatory while making payments. The taxpayer making the payment must deduct the TDS and deposit it to the Department of Income Tax before the assigned due date for depositing the TDS.

At times, the TDS is deducted from the total income of the taxpayer, i.e. the recipient, whereas the total tax liability of the taxpayer is calculated on the profit of that financial year. It is in accordance with the prevailing income tax rates/rules which may be less than the total amount of the TDS deducted.

In those cases, TDS will be deducted first, and the taxpayer can claim the refund of the excess amount of TDS deducted while filing the return on income tax (ITR). But the whole process turns out to be a hassle for many taxpayers because firstly TDS is deducted and later on the taxpayer asks for its refunds by filing ITR.

To make it easy, 

Section 197 has been issued by the government which allows taxpayers to use the Nil / Lower  Deduction of the TDS Certificate. But often the process of obtaining the Nil / Lower Deduction TDS Certificate takes a lot more time than expected.

To address this issue, the Government is allowing taxpayers to apply for the Nil / Lower TDS Deduction Certificate for the financial year 2020-21 from 28 February 2020.

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