Taxation was a hot topic last month. There seemed to be a huge last-minute rush at tax authorities on July 31st as tax-payers scampered to file their income tax returns.
If you were one of them, you know what a struggle it is to tally incomes, vouch through receipts and exemptions, and calculate your tax liability.
But guess what, there’s also some good news on this front.
The introduction of AIS has made tax filing a swift process. And here’s all you need to know about it...
The AIS or the Annual Information Statement was introduced in November last year to give taxpayers a single comprehensive statement on all their financial transactions done during a financial year.
In short, the AIS shows taxpayers of all the information the Income Tax (IT) Department has on them.
It includes salary, dividend, interest from savings account, recurring deposits, sale and purchase of equity shares, bonds, mutual funds, TDS, TCS, and any tax demand or refund.
And in all, it tracks details of 46 of your financial transactions.
AIS was introduced with the objective to:
So, taxpayers can now have all their yearly financial transaction information at once place, and the same can encourage them towards voluntary tax compliance.
What’s more is the income tax (IT) department recently released a much improved version 2.0 of AIS in March 2022 which covers many more transactions. Plus, the department has used data analytics to capture non-PAN transactions data, eliminated duplicate entries, and have generated a simplified taxpayer information summary (TIS) for ease of filing return.
This helps in ensuring that the income details in individual tax-payer’s income tax return form matches with that in the AIS. And any discrepancies can be found out easily in order to avoid tax evasion.
AIS is an extension of Form 26AS.
AIS is more comprehensive in that it reflects transactions irrespective of whether applicable tax is deducted or not.
That means, even if tax has not been deducted on any income (say the interest income received on a fixed deposit), it will still be shown under 26AS.
Similarly, other transactions, sale-purchase of equity, mutual funds, dividends, etc. are reflected irrespective of any monetary limit. Form 26AS, on the other hand, contains only tax deducted at source (TDS), tax collected at source (TCS), and statement of financial transactions (STFs) but only if those transactions have crossed a certain limit.
So be it a small investment of Rs 1,000 in a mutual fund SIP or receipt of Rs 100 as dividend income, it’s all reflected in the AIS.
AIS also provides the taxpayer the option to give feedback on the transactions reported. Further, the aggregation of transactions on information source level is also reported in TIS.
Although AIS is comprehensive, taxpayers will still have to reconcile all the three statements viz. AIS, TIS, and Form 26AS with their personal records.
So, the next time you’re wondering about your tax figures, just head on to your AIS statement for a detailed look.
Until next time,
Sources: Income Tax Department, Economic Times, Livemint
0 people liked this article.