Guide to a new Annual Information Statement under Income Tax

Guide to a new Annual Information Statement under Income Tax

Right from return filings to assessments and appeals in income tax law in India, digital means are being adopted. Income tax department is also providing an online facility of pre-filled return from details available with it from various sources so that more transparent and accurate filings are done and undisclosed income can be reduced. 

Form 26AS, statement of financial transactions (Form 61A), withholding tax returns by deductors (Form 24Q, 26Q, 27EQ), details of foreign remittances (Form 15A/15B), etc. are the various means by which the department collects financial information.

Recently, the Government has rolled out a new annual information statement expanding the scope of current Form 26-AS with the inclusion of various information categories like interest, mutual fund transactions, insurance, dividends, etc. 

Now, with PAN, financial data of a user is collected from various sources and monitored by the income tax department through new AIS with the use of AI technology. So, it is highly recommended to plan your financial activities along with the impact of taxes on them.

This article will guide you about new AIS, status of current Form 26-AS, accessibility of new AIS, information categories, etc. 

1.   What is an Annual Information Statement?

Annual Information Statement (AIS) is a comprehensive view of financial information for a taxpayer displayed in Form 26AS issued by the Income Tax Department under section 285BB of the Income Tax Act, 1961. It contains details about tax collected, deducted, transactions reported in statements of financial transactions, etc. The new AIS will provide additional categories like dividends, securities transactions, foreign remittances, mutual fund transactions, etc. 

The new AIS will also carry a simplified Taxpayer Information Summary (TIS) for each taxpayer showing aggregated value for various information for the taxpayer for ease of filing return. The information in TIS will be used for pre-filing of income tax return.

It is important to note that the present AIS on the compliance portal is showing details starting from the financial year 2020-21 in order to enable taxpayers to file their return for the assessment year 2021-22.

2.   What will happen to current Form 26AS?

Current Form 26AS will continue till the new AIS gets fully operational. The display of Form 26AS on TRACES portal will also continue in parallel till that time.

A question may arise that what will happen if there is a variation between the TDS/TCS information or the details of tax paid or any other information as displayed in Form 26AS on TRACES and the same information being displayed in AIS on compliance Portal, then, in such case, the taxpayer may rely on the information displayed on TRACES for the purpose of filing of ITR and for other tax compliance purposes.

3.   Accessing AIS on income tax compliance portal

New AIS can be accessed through income tax portal by following below steps:

  • Go to the ‘services’ tab.
  • Select Annual Information Statement
  • Click on the proceed button which will take you to the compliance portal.
  • View TIS and AIS on the home page of AIS on the compliance portal.
  • Click on the relevant title which you want to look at and then select the relevant financial year to see AIS or TIS.

Note: A taxpayer can download the TIS and AIS in PDF format  (if it is password protected, then use your PAN no. in upper case and date of birth for individuals and date of incorporation for non-individuals as password to unlock the file). AIS can also be downloaded in JSON format.

 4.   Transactions reported in AIS

AIS is broadly divided into two parts namely Part A and Part B. 

Part A contains basic details like PAN, name, date of birth/incorporation, Aadhar no., mobile number, address and contact details. 

Part B contains information relating to TDS/TCS, taxes payment, statement of financial transaction (SFT), etc.

All transactions in AIS to be reported are listed in below:

1. Salary 

2. Rent received 

3. Dividend 

4. Interest from savings bank 

5. Interest from deposit 

6. Interest from others 

7. Interest from income tax refund 

8. Rent on plant & machinery 

9. Winnings from lottery or crossword puzzle u/s 115BB 

10. Winnings from horse race u/s 115BB 

11. Receipt of accumulated balance of PF from employer u/s 111 

12. Interest from infrastructure debt fund u/s 115A(1)(a)(iia) 

13. Interest from specified company by a non-resident u/s 115A(1)(a)(iiaa) 

14. Interest on bonds and government securities 

15. Income in respect of units of non-resident u/s 115A(1)(a)(iiab) 

16. Income and long-term capital gain from units by an offshore fund u/s 115AB(1)(b) 

17. Income and long-term capital gain from foreign currency bonds or shares of Indian companies’ u/s 115AC 

18. Income of foreign institutional investors from securities u/s 115AD(1)(i) 

19. Insurance commission 

20. Receipts from life insurance policy 

21. Withdrawal of deposits under national savings scheme 

22. Receipt of commission etc. on sale of lottery tickets 

23. Income from investment in securitization trust 

24. Income on account of repurchase of units by MF/UTI 

25. Interest or dividend or other sums payable to government 

26. Sale of land or building 

27. Receipts for transfer of immovable property 

28. Sale of vehicle 

29. Sale of securities and units of mutual fund 

30. Off-market debit transactions 

31. Off-market credit transactions 

32. Business receipts 

33. Business expenses 

34. Rent payment 

35. Miscellaneous payment 

36. Cash deposits 

37. Cash withdrawals 

38. Cash payments 

39. Outward foreign remittance/purchase of foreign currency 

40. Receipt of foreign remittance 

41. Payment to non-resident sportsmen or sports association u/s 115BBA 

42. Foreign travel 

43. Purchase of immovable property 

44. Purchase of vehicle 

45. Purchase of time deposits 

46. Purchase of securities and units of mutual funds 

47. Credit/Debit card 

48. Balance in account 

49. Income distributed by business trust 

50. Income distributed by investment fund 

5.   Providing feedback on AIS

AIS allows a taxpayer to view all their tax-related information in one place. Upon viewing, if a taxpayer finds any information to be not correct or not related or duplicate, an online facility of submitting feedback for modification can be availed. An option of submitting feedback offline is also available through the use of AIS utility.

Against each information detail, the following feedback options will be available:

Option A : Information is correctIf the information belongs to the taxpayer and all the attributes of the information are correct.
Option B : Information is not fully correctIf the information belongs to the taxpayer, but all the attributes of the information are not correct. Upon selecting this option, relevant information fields will be displayed, and taxpayers will be able to update correct information details. e.g.- Account number, value, etc. 
Option C : Information relates to other PAN/yearIf a taxpayer is aware about the Information, but it belongs to another person or other year e.g. joint ownership of property.
Option D : Information is duplicate / included in any other informationIf the information displayed is already included in another information or it is duplicate information.
Option E : Information is deniedIf a taxpayer is unaware of this information/transaction and wants to deny that the said information pertains to that taxpayer. 
Option F : Customised feedbackThe feedback option will be displayed based on the information category. 

AIS will show the reported value and value after feedback separately. In case the information is modified/denied, the information source may be contacted for confirmation.

 6.   Action points for taxpayers

Taxpayers have to perform the following actions in respect of the new AIS:

  • View and analyse all their financial information showing in AIS on the compliance portal.
  • Submit feedback in case of any change in any information i.e. incorrect, not related to the taxpayer.
  • Track feedback and review modified values which will be updated in TIS to be  used in pre-filled data for return filing.

DISCLAIMER: The views expressed are strictly of the author and VJM & Associates LLP. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.

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