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NEW DELHI: Taxpayers will not have to mention their high value transactions Income tax return (ITR) and the government are not considering any modification in the form according to sources.
Any extension in reporting under the statement of financial transactions (SFT) would mean such reporting of high value transactions Income tax department Sources said that will be done by financial institutions.
“There is no proposal to revise the income tax return form,” the sources said. “The taxpayer will not be required to mention its high value transaction in its return.”
He said that collecting high-value transaction reports was the most non-intrusive way of identifying those who spend big money on various items and yet they do not file income tax returns by claiming that their income per year 2.5 lakh was less than Rs.
These items include business class air travel, Travel abroadSpending big bucks in expensive hotels or sending children to expensive schools.
Sources in the Finance Ministry said that the Income Tax Act already provided for the quotation of PAN / Aadhaar for certain high value transactions and their reporting by third parties mainly for the purpose of broadening the tax base.
Sources said, “It is an open fact that only a few people in India pay tax and not all those who pay their taxes are actually paying their taxes.”
Sources said that the I-T department is relying more and more on voluntary compliance and hence, expenditure data collected from third parties through SFT, is the best and most non-intrusive method to catch thieves.
The Income Tax Department currently obtains other information such as cash deposits / withdrawals such as savings from bank accounts, sale / purchase of immovable property, credit card payments, purchase of shares, debentures, foreign exchange, mutual funds.
It receives information from banks, mutual funds, bond issuing institutions and “specified persons” such as registrars or sub-registrars who have high value financial transactions since fiscal 2016.
In the 2020-21 budget, the government revised the format of Form 26AS, stating that all such information from various SFTs would be shown in the new Form 26AS. This is an annual consolidated tax statement, which can be obtained by the taxpayers from the Income Tax website using their Permanent Account Number (PAN).
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