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The newly introduced Annual Information Statement includes information that is presently available with the Income Tax Department. It is a comprehensive overview of taxpayers’ information displayed in Form 26AS. The taxpayer can access AIS by clicking the link ‘Annual Information Statement (AIS)’ under the ‘Service’ tab available on the new income tax portal (i.e., https://www.incometax.gov.in/iec/foportal).

Under the present article, we will briefly analyze the information category ‘Interest from others’ in AIS.

Information source in case of ‘Interest from others’-

Annual Information Statement (i.e., AIS) details under the category ‘Interest from others’ is gathered from the following two sources-

1. Statement of Financial Transactions (i.e. SFT-016)-

Interest paid or accrued or credited on others is reported under the Statement of Financial Transactions (SFT-016). Notably, this interest income doesn’t include interest on saving bank account; term deposit or recurring deposit.

2. TDS return filed in Form 26Q-

Deductor is liable to deduct TDS on the amount of interest paid/ credited on securities in terms of section 193 of the Income Tax Act, 1961. Accordingly, the deductor is required to furnish quarterly TDS return in Form 26Q reporting the amount of interest paid/ credited by them on securities.

AIS processing and information handling under ‘Interest from others’-

Information obtained from various sources will be processed under AIS in following manner-

  • Interest amount taxable in hands of the account holder-

Reporting entity is required to report the amount of interest paid/ credited/ accrued to the account holder under Statement of Financial Transactions (SFT-016). Further, the reporting entity (being a deductor of TDS) is also required to report the amounts via furnishing TDS return in Form 26Q.

Interest so earned by the account holder will be held taxable. Accordingly, interest on others will be reflected in the AIS of the account holder on the basis of the PAN of the reporting person; source and value of interest paid or credited or accrued.

  • Interest amount retained in case of reporting entity-

In the case of reporting entity, higher of the following amounts will be retained under AIS-

    • Amount reported under Statement of Financial Transactions (SFT-016); and
    • Amount reported under section 193 while filing quarterly TDS return in form 26Q.
  • Interest amount mentioned as ‘Information is duplicate/ included in other information’ in case of reporting entity-

Lower of the following amounts will be marked as ‘Information is duplicate/included in other information’ under AIS-

  • Amount reported under Statement of Financial Transactions (SFT-016); and
  • Amount reported under section 193 while filing quarterly TDS return in form 26Q.

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