Translate

Showing posts with label Annual Information Statement. Show all posts
Showing posts with label Annual Information Statement. Show all posts

Income Tax Department Is Looking At You

Income Tax Department Is Looking You!

-Dr. Lalit Kumar Setia

Dear Learners! Now you can join my online courses - Apply now!

Why Government imposes Income Tax?

Developed and developing nations around the world, adopt the tool of imposing income tax as a major source of income. From the amount collected through income tax, the development expenditure is financed and it is ensured to develop the nation economically as per the needs of the citizens. The Government finds it very easier to collect income tax by using 'Tax Deduction at Source'. The people who are doing jobs under their employers, face TDS on Salary which is deducted by the employers. The people earning interest on deposits, face TDS on interest on deposits by the concerned financial institutions. It is very hard for the Government collecting income tax, without ensuring the effective process of Tax Deduction at Source (TDS). 

Income Tax Department is Looking at You

Collection of Income Tax from people other than Employees and Investors:

One of the biggest problems of the Government is to collect income tax from self-employed people with making fewer investments in financial institutions. For example, Mr. X is running a shop and reporting less income. What can be done by the Government? Definitely, the Government may check the financial records of the shop to detect accurate income and impose penalties under Income Tax Act. But the problem is that Mr. X has managed the accounting books with too much care to be caught in the concealment of income and even he hired the services of a chartered accountant to plan and protect him from heavy taxes. Therefore, it is very hard to collect taxes from people who are neither employees nor investors.

Why do people prefer to start their own business than to do a job?

The take-home income of the self-employed people is higher than the incomes of employees who are serving any organization and it is due to non-compliance of income tax act or in other words with the help of theft of income tax. The rates of income tax and cess are increasing every year but the heat of the increase in income tax and cess is very less for the following people:

1. The people doing agriculture (farming only) 

2. Those who are having the hidden income (without the issue of bills to the users/buyers), and 

3. Those who are supported by Chartered Accountants (firms and companies with concealment of income using hired CAs).

It is very hard to collect a fair amount of income tax from the above people. To finance the development expenditure of the nation, the Government is raising taxes and charging more taxes from the people who comply with them i.e. employees and investors.  

The vigilance of Income Tax Department on Spending/Investing

Are you spending cash to buy the property and paying less tax in general, the income tax department is looking at you and noticing your transactions.  

No matter you are giving this information to the Income-tax department or not. The department is taking care of your such transactions. You being a taxpayer, can view the transactions recorded in your login at incometax.gov.in in the Annual Information Statement.

26AS and AIS Statement

The Income Tax Department rollout the new statement - AIS (Annual Information Statement) which gives all the details of financial transactions against a PAN number. Earlier there was only one statement i.e. Tax Credit Statement 26AS, now there are two statements, the additional statement is the Annual Information Statement. The AIS Statement is a more detailed statement of the income of the taxpayer including income from interest on the savings accounts, income from mutual funds, etc. Every taxpayer can download the statement from the portal of incometax.gov.in. After login, in the Services tab, there is an option of Annual Information Statement (AIS). In the AIS statement, there is a tax information summary which is brief details of the Annual Information Statement for the convenience of the taxpayer. 

The password of the downloaded Annual Information Statement (AIS)

The Annual Information Statement can be downloaded as a .pdf file or .json file as per the requirement of the taxpayer. The downloaded file is password protected to reduce the misuse of the confidential information and credentials of the taxpayer. The password is PAN Number (in Capital letters) followed by Date of Birth. For example, your PAN number is ATMPO1234R and your Date of Birth is 1st December 1987; then the password will be ATMPO1234R01121987. In an AIS statement, a taxpayer can access the details of 'interest on all savings accounts connected with his/her PAN number', 'income from Salary as per the statement filed by the employers', 'income from the investments or mutual funds as per the statement filed by banks and financial institutions, 'income from dividends, etc. 

Tax Planning and Tax Evasion

Doing tax planning is good for everyone but tax evasion is a crime. In case, anyone is evading tax and it is traced by the Income Tax Department or other authorities by observing expenditure of the persons, then the tax evaders are panelized as per the provisions of the Income-tax act. 

As per new provisions of the Income Tax Act, financial institutions including banks, brokerage companies handling mutual funds, and Registrars of properties are required to intimate the Income Tax Department about the transactions of heavy amounts with the PAN or TAN number of the person.

Fixed Deposits in Financial Institutions: 

Whenever any person deposits an amount in the fixed deposit account and it becomes more than Rs. 10 lacs against his PAN number, the financial institutions require to inform the income tax department. However, in case there are old Fixed Deposits renewed every year and be more than Rs. 10 Lacs, there is no need to inform Income Tax Department of such old Fixed Deposits.

The amount deposited in Bank in one Financial Year:

As per rules, the financial institutions are required to intimate Income Tax Department about the persons who have deposited more than Rs. 10 Lacs during the Financial Year. There is a provision to pay income tax for making cash deposits above Rs. 10 Lacs.

Beware of using more amount through Credit Card:

If you are using a credit card and get your limits enhanced for use of more amounts. In case, the amount due on the usage of a credit card becomes more than 1 Lac, the Financial Institutions are required to inform the Income Tax Department. And during the year if the amount spent, becomes more than 10 Lacs the Income Tax Department imposes a tax upon it. 

Purchase of higher amount properties:

The properties are registered whenever purchased. If you are purchasing a property with costs more than 30 Lacs, the registrar is required to send the information to the Income Tax Department. In case of the purchase of bonds, if the amount of bonds, shares, and mutual funds issued by the company becomes more than Rs. 10 Lacs, then the company is required to intimate it to the Income Tax Department because the buyer is required to pay tax in such transactions. 

Black Money Control by Seeking Statement of Financial Transactions:

The income tax department is now more active to curb the practices of people accumulating black money. No doubt, the initiatives have also been taken earlier by the department by launching various disclosure schemes. But now focus is to utilize the information from certain government agencies and authorities for identifying certain transactions based on reliable submitted reports of high-value transactions in "Annual Information Return (AIR)" u/s 285BA.

What do people are preferring today to increase take-home income?

In India, work in Multinational Companies (MNCs) particularly, the work from home (WfH) with getting salaries in cryptocurrency which is not easily regulated by the Government; is a new challenge for the Indian Government. People are preferring this mode of income to increase their take-home income (without the imposition of income tax by the Government). 

A Course on e-filing Income Tax Returns (ITR) for Salaried Persons is organized in online mode for specific training for accurately e-filing Income Tax returns specifically ITR-1.

*Copyright © 2021 Dr. Lalit Kumar. All rights reserved. 

This article is written by Dr. Lalit Kumar Setia; a renowned author and trainer. He completed his Doctorate in Commerce from Kurukshetra University Kurukshetra and MBA in Information Technology from GJU, Hisar. He also wrote two books, 15 research papers, and organized more than 200 Training Courses during his working period since 2006 in Haryana Institute of Public Administration, Gurugram. The article was published on 26th May 2021 and last updated on 7th October 2021. The writer can be contacted on lalitkumarsetia@gmail.com 

More content of your interest:

https://questionsinexam.blogspot.com/2021/07/fixed-medial-allowance-from-employer-is.html  

https://questionsinexam.blogspot.com/2021/07/taxability-on-conveyance-allowance.html  

https://groomthepersonality.blogspot.com/2018/02/financial-terminology-for-drawing-and.html  

Auto_1

Horizontal Responsive1

Popular Posts

LoP_1

Special Offer!

Funny Baba

Free Seminars

Featured post

Dr. Lalit Setia CV

Free Notes

Tips to Grow

Earn Money

Popular Posts

Free Download

Tax Saving

Fun in Life

Labels

Professional Guidance Government Income Tax Tax Deduction at Source General Knowledge Important Questions Income Tax TDS Accounting Deduction Governance Haryana Income Tax Return Latest Questions Competitive Examination Current Affairs Drawing and Disbursing Officer Audit Auditing Covid Financial Financial Management Financial Terminology Goods and Services Tax India Knowledge Lalit Kumar Lalit Kumar Setia Money Skills Tax Planning Virus Accounts Attitude Banking Compliance Currency Economic Problem Employee Facts Free Notes Functions GST Government Accounting Government eMarketplace Incomes Information Interest Omicron Virus Organization Payment Science Scientific Causes Section 80C TDS on GST Tips Tricks Very Important Questions answers Administration Advance Tax Anti-Virus Automatic Back Up Balance Sheet Bitcoin Certificate of TDS Computer Control Corruption Creativity Cryptocurrency DDOs Deductions Deductor Deductors Development Dr. Lalit Kumar Duties EPS Economy Employer English Evaluation Example Expenditure FAQs Finance Financial Accounting Financial Administration Financial Control Frustration GeM General Studies Geography Google HRA Information Technology Investment Life Management Meditation Omicron Performance Planning Positivity Process Procurement Public Public Administration Public Services Purchase Matters Questions on General Studies Resources Resume Saving Services Stress Success System Tax Collection Taxable income Technique Technology Tender Training Trust 26AS 80GG 80GGC AIS Statement ATM Abatement Abbreviations About Dr. Lalit Setia Accountant's Duties Accounting Heads Accounting Standards Accounts Branch Accrual Accumulated Fund Act Action Administrative Admissibility of DA Advance Allowance Almighty Amalgamation Amazon Amount Amrapali Group Android Annual General Meeting Annual Information Statement Anomaly Anti-Corruption Anti-virus Protection Antonyms Appraisal Appreciation Arbitrator Arrears Articles of Association Asset Auctio Audit concerns in procurement Automated Teller Machine Automatic Teller Machine Autorised Capital Average Award Bad Debts Balance of Payments Bankrupt Barter Benchmark Bhagat Prahlad Bid Bikaner Bio-Data Bitcoins Bitcoins Network Block Chain Blood Breathing Bribe Buddha Budget C M Window CV Canada Cards Caring Nature Cash Book Cash Flows Central Bank Chapter Character China Clerks Commitment Common Man Communication Communization Competitive Examinations Computation Computer Virus Computerization Conflict Contacts Contribution of Employees Corona Crime Crude Oil Culture Curriculum Vitae Custody Cyber Cybercrime Data Dearness Allowance Debit and Credit Decision Making Deduction under section 80GG Delay in Service Delhi Department Dera Sacha Sauda Desktop Devices Digital Transformation Double Click Double Entry System Dr. Lalit Setia EPF Earnest Money Deposit Earning Money Economic Growth Electronic Payment System Employment Energy Solutions Environment Evasion Examination Exempt Exemption Exemptions Expenditures Experience Exploitation Facebook Failure Festivals Final Accounts Financial Rules Financial Statements Formula Frauds Games General Generation Gap Goals Google search bar Government Deductor Government Officers Grades of Employees Gurmeet Ram Rahim Singh HRMS HUF Harish Chandra Higher Education Hindu Undivided Family History Home Loan House Building Advance House Property House Rent Allowance How to stay protected Human Resource Management System Humanity IAS Officers IT Skills ITR Importance Income Statement Income Tax Changes Income Tax Refund Income and Expenditure Account Income from Gifts Indirect Cost Innovation Internet Interpersonal Interpretation Inventory Inventory Management Investigation Investments Irregularities Jiomeet App Jokes Kids Labour Laptop Laundering Leadership Leadership Tussle Learn Learn English Learn Excel Shortcuts Learning Ledger Ledgers Liquidity Logical Lokpal Lost Crypto currencies Love MS-Office MS-Word Maldives Mankind Mask Material Mathematics Matters Meaning Measurement Equipment Meerabai Messages Methods Minimum Income Scheme Misuse Mitigation Mobile Monitor Monitoring Morality Motivation Mumbai Lockdown NPS National Highways National Pension National Pension System Nationwide Payment News Non Performing Assets Non-performance Official Life One Liner Questions Outstanding PAN number Pakistan Parents tips Pebbles Penalty Pension Per Day DA Petroleum Phonebook Practices Prevention Prices Prime Minister Private Gain Probability Problem Procedure Protection Publica Publishing Purchase Question Quotation Quotes Rational Decisions Rebate Reforms Register Registration Relationship Rent Paid Reporting Research Retirement Robert Vadra SAP SWOT Analysis Saint Ravi Dass Salaries Saudi Arabia Scam Scientific Searching emails Section 234 (a) Section 234 (b) Section 234 (c) Section 87A Security Security of Bitcoins Self Growth Shortcut Smashwords Social Activists Software Space Speculation Spyware Standard Deduction Standard Deduction on Salaries Standards Statistics Story on Husband and Wife Study Material Sugamya Pustakalaya Superintendent Symbols Symptoms of Omicron Synonyms TA Rules TAN TDS Payment Talent Search Tax Credit Taxation Taxpayers Techniques for fast and efficient work Thought Tips for Students Toddlers Tools of Rulers Tourism Trial Balance Type UCP Uncertainty Unemployment Uniformity Unique Code of Payee United States of America Users Using Asterisk Using Quotes Using Site Using minus Utilization Utilization Certificate Vigilance Bureau Whatsapp Working Capital e-Payments e-filing eMarketplace eProcurement financial procedures gmail immunity innovative solutions pandemic records management red-handed speed vaccine बैंकिग मापने वाले यंत्र राष्ट्रीय राजमार्ग

Happy Moments

Learn and Update

Popular Posts

Auto_1

Horizontal Responsive1