Annual Information Statement (AIS)- Income and long-term capital gain (LTCG) from foreign currency bonds or shares of Indian companies under section 115AC
Rule 31AB covering the provisions relating to Form 26AS was omitted vide the Income Tax (Eleventh Amendment) Rules, 2020. Correspondingly, rule 114-I was inserted in the Income Tax Rules.
According to new rule 114-I, the income tax authorities will now upload the Annual Information Statement in Form 26AS. Said statement will be uploaded to the registered account of the assessee.
As per rule 114-I, the Annual Information Statement will consist of the following information-
One such information covered under the Annual Information Statement is ‘income and long-term capital gain from foreign currency bonds or shares of Indian Companies u/s 115AC’ which is taken up and discussed in the current article.
Section 115AC of the Income Tax Act covers the following types of income earned by a non-resident-
Notably, the above income is taxable as per provisions and rates specified under section 115AC.
Accordingly, the person responsible for paying income arising under section 115AC is required to deduct TDS as per provisions of section 196C. Section 196C states that the deductor is liable to deduct TDS @10% within earlier of the following dates-
The person deducting TDS under section 196C is also required to carry out the following two duties-
1. File TDS return/ statement in Form 27Q on a quarterly basis; and
2. Issue TDS certificate to the deductee in Form 16A.
The information/ details furnished by the TDS deductor via TDS return in Form 27Q will be taken as an information source in the Annual Information Statement.
The details received from Form 27Q filed by the deductor will be processed in the Annual Information Statement in the following manner-
1. Firstly, the income will be taxable in the hands of the recipient; and
2. Such income will be reflected under the head ‘Income from other sources’.