How can taxpayers Track their High-Value Transactions?

You can use your Form 26AS to see if you have any transactions flagged as “High-Value Transactions”. Entities such as Banks and other Financial Institutes are responsible to furnish certain transaction details through Form 61A (Annual Information Return). With an aim to curb black money and to track high-value transactions, the government has implemented new reporting guidelines. Therefore, “High-value transactions” of Individuals and Businesses are monitored u/s 285BA of The Income Tax Act.

Form 26AS as an 'Annual Information Statement' from 1st June 2020 will include Property and Share Transaction details
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Form 26AS as an 'Annual Information Statement' from 1st June 2020 will include Property and Share Transaction details

Steps to track High Value Transactions

  1. Log in to the Income Tax e-Filing Portal

    Visit the Income Tax e-Filing portal and login using valid credentials.

  2. Click on “My accounts

    Select View Form 26AS (Tax credit) Option

  3. View Tax Credit Statement

    Click on the option to proceed which will redirect you to the TRACES portal.

  4. Agree usage and acceptance of form 16

    Click on the checkbox and then proceed.

  5. Option to view the form

    Now you can click on the option to view the annual information statement.

  6. Enter the required details

    Enter the assessment year and choose the type of file you wish to download. The downloaded file will be password protected and the password is your Birth date.

  7. Lastly, you can look at Part E

    It has the details of AIR Transaction in the downloaded file.

FAQs

What is File Validation Utility (FVU)?

FVU created by NSDL is a program to verify the format of AIR submitted by filers and to measure its accuracy. FVU will accept AIR submissions only if it is error-free. If there are any errors in the details an error code and error description and details about the error will be displayed. You can resubmit your form after correcting the errors. If there remains no error in filing AIR then the “File Validation Successful” message pops up.

How does the Income Tax Department (ITD) come to know about my “High valued Transactions”?

Well, If any Individual/Business makes a Financial Transaction which can be considered as “High valued Transactions”. Then the Bank and other Financial Institutes have to report the transaction with the registered PAN of that Person. Hence, ITD can come to know about your “High valued Transactions”

What are the Forms required for AIR?

AIR can be furnished through Form 61A (Part B) in a digitized form in a CD/Floppy. While Form 61A (Part A) in a paper format duly signed.

Form 61A : Annual Information Return (AIR)

Some individuals need to file Form 61A to justify their High Value Transactions, you can track the status of this filing on the TIN-NSDL website. Entities such as Banks and other Financial Institutes are responsible to furnish certain transaction details through Form 61A (AnnualInformation Return). Hence, with an aim to curb black money and to track high-value transactions, the government has implemented new reporting guidelines. Therefore, “High valued transaction” of Individuals and Businesses are monitored u/s 285BA of The IncomeTax Act.

Form 61A contains details of the transaction and reportable account maintained by the specified persons during the Financial Year. The Income Tax Department using AIR monitors these High valued transactions.

Who should file Form 61A (AIR)?

According to the section 285BA of the Income Tax Act, 1961, “Specified persons” are required to record and report “High-value financial transactions” of individuals and file Form 61A, upon receipt of notice. For instance, these specified persons can be:

  • Individuals and Taxpayers
  • Banks
  • Mutual funds
  • Institutions issuing bonds and registrars or sub-registrars

Detailed information on who should file Form 61A (AIR) as per the Tax Information Network (TIN) is as follows:

Sr. No.

 

Class of Person

Nature and value of the transaction

Clarification by Central Board of Direct Taxes vide circular

 

1.

 

Banking Company to which the Banking Regulation Act, 1949 applies.

 

Cash deposits of any person totaling to Rs. 10,00,000 or more in a year in the savings account of any bank.

 

The total of all the cash deposits in the savings account of a person should be reported as one single transaction. However, the date of the transaction should be the last date of the financial year.

 

 

2.

 

Banking Company to which the Banking Regulation Act, 1949 applies or any other Company or Institution issuing the credit card.

 

 

If credit card payments against a person are Rs.2,00,000 or more in a financial year.

 

The total of all the payments by a person to the credit card company should be reported as one transaction. And hence the date of the transaction is to be the last date of the financial year.

 

3.

 

trustee of a Mutual Fund or such other person managing the affairs of the Mutual Fund as may be duly authorized by the trustee in this behalf.

 

 

This is if you are acquiring any units of fund amounting to Rs. 2,00,000 or more in a financial year.

 

The amount actually received from the transacting party and not the amount relating to the allotment is to be reported.

 

4.

 

Company or Institution issuing bonds or debentures.

 

This is if you are acquiring any bonds or debentures amounting to Rs.5,00,000 or more in a financial year by the Company or institution.

 

 

The amount actually received from the transacting party and not the amount relating to the allotment is to be reported.

 

5.

 

Company issuing shares through public or rights issue.

 

If you are acquiring any shares of a company amounting to Rs. 1,00,000 or more

 

 

The amount actually received from the transacting party and not the amount relating to allotment is to be reported.

 

6.

 

Registrar or Sub Registrar appointed under section 6 of the Registration Act, 1908.

 

If you are purchasing or selling any immovable property that values Rs.30,00,000 or more in a financial year

 

Certain situations where the transaction of property valued at Rs. 30,00,000 involves joint parties and value for one or more parties is less than Rs. 30,00,000.

In such situations, all such transactions are to be reported even though the value of transaction in the hands of one or more of the joint parties is less than the threshold limit.

 

 

7.

 

An officer of the Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 1934 who is duly authorized by the Reserve Bank of India in this behalf.

 

 

This is applicable if you are acquiring any bonds issued by the RBI amounting to Rs. 5,00,000 rupees or more in a year

 

The total of all the receipts from a person is required to be reported as one transaction and the date of the transaction is to be mentioned as the last date of the financial year.

Circumstances under which Form 61A is rejected

AIR may be rejected due to the following reasons:

  • Filers have to mention the filer’s name, TAN, PAN, Form number and the Current Financial Year. Any mismatches with the form and file submitted will end up in rejection.
  • If the return file provided on Computer media is not generated by the AIR FVU.
  • When you don’t file Form 61A (Part A) in the physical paper format along with the AIR file.
  • When your Form 61A (Part A) is not duly signed or verified.
  • Overwriting on Form 61A (Part A) not approved by the person who has signed the same.
  • When you use more than one computer to file the AIR. Also, when computer media finds your submission corrupted or with any viruses.
  • If you compress the AIR file using any other compression utilities than Winzip 8.1 or ZipItFast 3.0 or higher version.
  • Mismatch of the total in Form 61A with the total of SAM (Statement Acceptance Module) at the TIN Facilitation Centre.

Consequences of not submitting Form 61A on Time

Tax authorities of India, under section 285BA (5) can issue a notice to a specified person asking them to file Form 61A (Annual Information Return) within a period of 30 days from the date of receiving the notice. If they fail to file the statement within the allotted time then they will face a penalty of INR 1,000 per day after the date mentioned in the notice for furnishing the statements.

Steps to file Form 61 (AIR)

  1. Visit the TIN-NSDL website

    Download your AIR Return Preparation Utility (RPU) provided through NSDL

  2. Next you download your AIR RPU

    This is how your downloaded AIR RPU form will look like

  3. You need to fill in the required details in the given sheets under the downloaded excel file

    Post downloading the form

  4. Next you need to download the E-AIR FVU application

    To do this you need to download the latest JAVA software

  5. After setting up the application, you can now upload your excel sheet there

    If your file has any errors, the application will generate errors through the error file path. All errors need to be cleared in order to have the file accepted.

  6. Your accepted file needs to be copied on a CD or a Floppy

    Lastly, you need to visit the TIN-NSDL AIR section and skip to the 5th step and download Part A of Form 61A

  7. Next, visit your nearest TIN Facilitation Center (TINFC) and file your AIR return

    Now that you have your file on a CD or a Floppy and have your Part A of Form 61A filled.

Track Form 61A Filing Status

  • Visit the Tax Information Network Portal and click on services and select Annual Information Return from the dropdown
  • Select “AIR status view for filers
  • Enter your PRN and valid TAN

FAQs

What is File Validation Utility (FVU)?

FVU created by NSDL is a program to verify the format of AIR submitted by filers and to measure its accuracy.
FVU will accept AIR submissions only if it is error-free. If there are any errors in the details an error code and error description and details about the error will be displayed.
You can resubmit your form after correcting the errors. If there remains no error in filing AIR then the “File Validation Successful” message pops up.

How does the Income Tax Department (ITD) come to know about my “High value Transactions”?

If any Individual/Business makes a Financial Transaction which can be considered as “High value Transactions”, then the Bank and other Financial Institutes are responsible to report the transaction to the ITD, along with the registered PAN of that Person. Hence, ITD can come to know about your “High valued Transactions”

What are the Forms required for AIR?

AIR can be furnished through Form 61A (Part B) in a digitized form in a CD/Floppy. While Form 61A (Part A) in a paper format duly signed.