All About New Annual Information Statement (AIS)
NEW ANNUAL INFORMATION STATEMENT (AIS)
- The Income Tax Department has introduced new Annual Information Statement (AIS) on the Compliance Portal, that provides a complete view of information to taxpayers and allows them to provide online feedback.
- The latest AIS can be accessed by going to the “Services” tab on the new Income Tax e-filing portal www.incometax.gov.in and clicking on the link “Annual Information Statement (AIS).”
- The screen of Form 26AS on the TRACES portal would also persist until the new AIS has been validated and is fully operational.
What exactly is AIS?
The quantity of information available in AIS and TIS demonstrates how the IRS maintains 360-degree data profiling on taxpayers. This information resembles a birth chart, as it depicts all of the taxpayers’ financial transactions during the financial year.
Maximum details are now under the I-T department’s horizon due to the modified AIS. Furthermore, the government has indicated that it has access to data not included in the AIS, which will let tax inspectors examine a taxpayer’s profile more broadly and limit the scope of evasion.
As a result, taxpayers should carefully review all transactions in the AIS to ensure that appropriate data is included in their tax returns. They must make proper use of the department’s feedback and correct any errors before filing their tax returns.
- The AIS is a comprehensive statement that contains details of financial transactions performed by you and reported to the tax department by various entities (mostly financial institutions) during a fiscal year.
- This includes receipts/income from various sources such as salary, interest, and so on, as well as the sale or purchase of securities such as equity shares, mutual funds, bonds, and so on.
- Each and every sale as well as purchase of shares, mutual fund units, and any dividend or interest received, will be reflected in the AIS.
Part A and Part B are the two parts of AIS.
- Part-A contains basic information such as PAN, masked Aadhaar number, taxpayer name, date of birth, and so on.
- Part-B contains data on TDS, TCS, specific financial transactions, tax payment, tax demand and refund, and other topics.
- According to a press release from the tax department, taxpayers will be able to download AIS information in PDF, JSON, and CSV formats.
Are AIS & TIS the Booster mover dose for Income Taxpayers? : Income Tax
- Tax terrorism is a well-known enemy of Indian taxpayers. Tax assessments and tax disputes have caused a huge amount of concern among income tax payers.
- Finally, the Govt acknowledged this reality and attempted to simplify tax procedures by establishing annual information statements (AIS) and taxpayer information summary (TIS).
- In Form 26AS, AIS refers for all-inclusive information for a taxpayer. A taxpayer’s TIS is a category-by-category information summary. While submitting the return of income, AIS and TIS seem to represent knowledge over unawareness.
- Form 26AS was first introduced as a tax credit statement of the taxpayer. It includes information on advance tax paid, self-assessment tax paid, and taxes taken from taxpayers’ sources of income, such as tax deducted at source (TDS) or tax collected at source (TCS), as well as any income-tax (I-T) refunds received throughout the financial year.
- Budget 2020 proposed expanding the mandate of form 26AS and making it more thorough by including specific data about the taxpayer’s tax profile.
- As a result, the I-T department has notified the new AIS in form 26AS, effective 1 June 2020, in May 2020. All information provided by banks and financial institutions was changed and included.
- Previously, these details were included in their financial transaction statement (SFTs).
- CBDT issued a directive in October 2021 to expand the range of reportable things under form 26AS, as specified under section 285BB of the I-T Act.
- The form has been expanded to include eight new kinds of transactions: international remittances, dividend income, mutual fund purchases, stock purchases, interest on I-T refunds, off-market transactions, complete salary division, and information from another person’s I-Tax return.
- According the I-T department’s statement, form 26AS will stay on the TRACES portal until the new AIS has been validated and is fully operational.
In addition to AIS, the income tax department introduced the Taxpayer Information Summary (TIS).
- This is a streamlined method of viewing the AIS data. TIS displays the processed value (i.e. the value produced after information redundancy based on pre-defined rules) as well as the obtained value (i.e. the value obtained after considering the taxpayer processed value & feedback).
- When a taxpayer gives information on AIS, the derived information in Taxpayer information system is updated automatically in real-time. The findings further showed in TIS will be used to populate the Return (pre-filling will be enabled in a phased manner).
- As a result, if you find an error in your Tax payer information summary or Annual information summary, you must have it corrected in the AIS, which will be corrected in real-time in TIS as well.
- It is critical to review the AIS and provide feedback. If there is a mistake & you have not provided feedback requesting correction, it may be assumed that the information reflected in AIS is correct, and the income tax department may ask you to explain the discrepancy between the information in the AIS and the information in your income tax return.
- If a taxpayer believes that the information is wrong, relates to another person/year, is copy, or is otherwise inaccurate, an online feedback form is available.
- Feedback can be provided by submission of a large amount of information in bulk. An AIS Utility has also been made available for taxpayers to view Annual information summary and upload feedback offline.
- In the AIS, the disclosed valuation and the valuation after feedback will be displayed separately. If the data is changed or denied, the source of the information may be consulted for verification.
- Taxpayers must keep in mind that the Annual Information Statement (AIS) includes information that is currently available with the Income Tax Department.
- There might be some transactions related to taxpayer that are not currently displayed in the Annual Information Statement may exist (AIS).
- Taxpayers should double-check all related information and report accurate and complete information on their Income Tax Return.
- Taxpayers are asked to review the information in the Annual Information Statement (AIS) as well as provide feedback if it needs to be changed.
- The valuation shown in the Taxpayer Information Summary (TIS) may be taken into account when filing the ITR. If the ITR has been already filed and some information is missing, the return may be updated to incorporate the correct information.
- If there is a discrepancy in between TDS/TCS info or tax payment information showed in Form 26AS on TRACES portal and the TDS/TCS information or tax payment details displayed in Annual Information System on Compliance Portal, the taxpayer may rely on the information displayed on TRACES portal for the purpose of filing ITR and other tax compliance purposes.
Taxpayers can consult the Annual Information System documents (AIS guidebook, Presentation, User Guide, and FAQs) in the “Resources” section or contact the help desk via the “Help” section on the AIS Homepage if they have any questions.
What distinguishes AIS from Form 26AS?
Form 26AS is similar to a tax passbook in that it contains information about TDS and TCS deposited against the taxpayer’s PAN during the fiscal year.
Furthermore, in the altered version of Form 26AS, information relating to specified transactions like mutual fund unit purchases, foreign remittances, and so on will be reflected only if the transaction exceeds the specified limit or tax has been deducted.
- For example, if tax is deducted on the interest earned on a fixed deposit, it will be reflected on Form 26AS.
AIS is a more comprehensive system. In the case of AIS, the transactions will be reflected regardless of whether or not tax has been deducted. As a result, even if no tax is deducted from the interest received on a fixed deposit, it will still be shown in the AIS.
- The statement will include TDS, TCS, the sale and purchase of equity shares, mutual funds, dividends, interest income, and other items.
- There is no set limit for the number of transactions that can be included in the AIS. Thus, even a Rs 2,000 investment in a mutual fund SIP will be reflected in your AIS. Basically, AIS reflects all of your large and small specified financial transactions that have been reported to the income tax department by various financial entities.
- Such reporting is required of these entities by law. AIS displays all of your financial transactions that the income tax department is specified.
- Both AIS & TIS are expected to benefit taxpayers by providing details of all transactions and assisting them in being prepared in advance for essential discussions with tax officers. Importantly, the move will provide more transparency and detail about the assessees’ financial situation. On the other hand, they give the tax authorities with a comprehensive data set in one location.If properly implemented, this initiative will create a taxpayer-friendly environment and uphold the I-T department’s pledge to treat taxpayers as “honest” as stated in the taxpayers’ charter. This will also provide the government the power in its efforts to provide a seamless, painless, and faceless tax administration.
How can AIS assist taxpayers?
- With the assistance of Annual Information System, you can cross-check all financial transactions that you conduct and report to the income tax department. This will assist you in double-checking and reporting all of the required information on your income tax return.
- For example, a dividend received in fiscal year 2020-21 is taxable in your hands. As a result, even if the amount is as low as Rs 50, you must report it in your ITR and pay tax on it. If you ignore to report this Rs 50, the AIS will help you remember.
- This will assist them in removing any duplicate or incorrect information. The resulting data in TIS will be spontaneously updated in real-time if the taxpayer sends a response on AIS after rigorous scrutiny, and that information will be used for pre-filing of tax returns. As a result, taxpayers have been encouraged to double-check all related information and provide detailed and accurate information in their I-T filings.
- If a taxpayer has previously submitted an I-T return but some details were left out, the return may be updated to include the correct information.
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