The tax filing process has become simpler and easier after the Income Tax Department rolled out Annual Information Statement (AIS) on its portal this week. The statement provides comprehensive information about financial transactions done by a taxpayer in the previous financial year. You can access the statement for FY 2020-21 by clicking on the link 'AIS' under the 'Services' tab on incometax.gov.in.
AIS is more comprehensive compared to the existing form 26AS, which provides information only relating to Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). It is a single reference document for taxpayers, which provides complete and detailed information relating to salary, dividend, interest from saving accounts and deposits, securities and mutual funds transactions, off-market debt transactions, foreign remittance, etc. In addition to AIS, a simplified Taxpayer Information Summary (TIS) can also be downloaded which gives an overarching view of the financial transactions.
Experts say it is going to benefit taxpayers, as it often happens that people fail to mention a few transactions, whether intentionally or unintentionally, while filing their Income Tax Returns (ITR). The AIS gives a glimpse of transactions beforehand and therefore reduces the chances of enquiries and notices from the department even for small mistakes.
What should taxpayers do?
If you have already filed an ITR for the financial year 2020-2021 then you should cross-check the details with AIS so that there is no mismatch of income.
“Since AIS maps all financial transactions done in the previous year, a taxpayer should refer it while filing ITR. If one has already filed the ITR and there is some mismatch in income, then the taxpayer should file a revised ITR to avoid getting notices from the department,” said Tarun Kumar, Direct Tax Leader at Coherent Advisors.
Shailesh Kumar, Partner, Nangia & Co LLP, said “On one hand, AIS is expected to be useful to taxpayers in giving details of all the transactions, where their PAN is reported by a concerned reporting entity and prepare them in advance for necessary discussion with tax authorities. On the other hand, this AIS provides comprehensive information database to the tax authorities regarding transactions undertaken by the taxpayer, at a single place.”
What to do in case of any discrepancy?
If there is an incorrect transaction on the statement, then you can escalate and get it rectified, too. “With roll-out of AIS, taxpayers will need to review their AIS from time to time and watch out for any transaction reported in their AIS. In case they believe any incorrect information has been reported in their AIS, they should reach out to the concerned reporting entity immediately and maintain necessary documentation to prove that such incorrect transaction reported in their AIS does not belong to them,” said Shailesh Kumar.
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