What does high value transaction notice from income tax means?

If you have got some similar message from the income tax department for any FY(Financial year) then probably you have missed to declare some Income/Interest/Dividend/Expenses while filing your ITR.

A mismatch can happen if the data values provided by you in your Income Tax Returns do not match with the third party information. These third parties are banks, mutual funds, service tax department, sub-registrar of properties etc.

List of Third parties who report High value Financial Transactions

• Banks – They report High Value transactions related to deposits credit card payments.
• Mutual Fund AMC
• Companies issuing shares, bonds or debentures
• Property deals

How do third parties report?

To keep a watch on high-value transactions by tax payers, the I-T department has developed a statement of financial transactions called?Annual Information Statement?(AIS). On its basis, tax authorities will collect information on suspected high value transactions during a year.

(What is AIS ??–?Annual Information Statement (AIS) of ‘high value financial transactions’ is required to be furnished under section 285 BA of the Income-tax Act, 1961 by ‘specified persons’ in respect of ‘specified transactions’ registered or recorded by them during the financial year.)

Also, it is mandatory that all the specified entities?(third parties)?to furnish an AIS in respect of specified financial transactions registered or recorded by them during any Financial Year.

All the above third party establishments have your PAN details and they quote PAN details of all the high value financial transactions recorded by them in AIR. They submit AIR to the income tax authority.

The Difference between AIS and Form 26AS

Whilst Form 26 AS only mentions high-value transactions and tax deducted at source, the AIS includes full data of savings bank interest, interest on deposits, capital gains, foreign remittances, and share transactions. It is important to note that AIS shows only that information that is available to the income tax department. The transactions that are not available with them shall be reported by the taxpayer accurately to avoid any penalties or notices.

How to check your AIS?

1.?To access your Annual Information Statement (AIS), log in to the income tax e-filing portal at www.incometax.gov.in. Go to ‘Services’>’Annual Information Statement’.

2. It will redirect you to the compliance portal.?You can view Taxpayer Information Summary (TIS) and Annual Information Statement (AIS) on the AIS home page.?

3.?Now select the relevant financial year, and you can view the Taxpayer Information Summary (TIS) or the Annual Information Statement (AIS) by clicking the relevant tiles.

You can view the screenshot of the TIS summary.

What are the different types of information shown in AIS?

• It includes new information – interest, dividend, securities transactions, mutual fund transactions, foreign remittance information, etc.

How to resolve a notice/feedback for high value transaction?

The taxpayer can submit feedback online. Through online mode, the feedback can be submitted only in the AIS section of the compliance portal. Let us see where to submit the feedback in the AIS section.

For any transaction click on 'optional' and you can submit your feedback selecting from the drop down button.

Conclusion:

Don't ignore these messages from income tax it may cost you hefty interest. Like investments this also something to be looked at in a very carefully.

Even if you haven't received any please go and check your AIS. Sometimes messages get dropped.

If you like this article,?do?Like??? , Share and Comment ???and don't forget to subscribe to this newsletter..!