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Income Tax Department becomes more VIGILANT

The Income Tax department has started a new drive to catch Tax evaders. In order to catch tax evaders and black money hoarders it has started collecting information related to high value transactions of purchase/ sale, investment and other expenditures in the income tax return itself. Further it also collects corresponding information from Banks, financial institutions, mutual funds AMCs and land revenue department and security depositories to cross check the same from the filed tax return of the tax payers.

Today we shall share with you the important nature of transactions which you must disclose in you tax return. As the income tax department may take serious action in case of non disclosure and in case of tax evasion the consequences may involve levy of interest and penalty upto 300% of tax evaded and also launching prosecution.

Income Tax Department collects information about your investments/expenses related to:

  1. Purchase or Sales of immovable property valued at Rs 30 lac or more;
  2. Credit card expenditure exceeding Rs 2 lac per annum;
  3. Mutual fund investments excess of  Rs 2 lac;
  4. Purchase of Bonds or debentures of a company or an institution for 5 lac or more in  a year;
  5. Cash deposits of Rs 10 Lac or more per annum in your saving bank account;
  6. Payments of Rs 1 Lac or more for acquiring shares of a company through its public or rights issue;
  7. Purchase of bonds issued by the reserve bank of India amounting in aggregate to Rs 5 lac or more in a year;

As mentioned earlier banks, financial institutions, Mutual Fund Asset Management Companies, land revenue department and security depositories are instructed to furnish the particulars of tax payers falling under any of the above criteria.

As per the press release of the Income tax department, it has information about:

  • 40,72,829 persons who made cash deposits exceeding 10 lac or more in their savings bank account;
  • 40,40,396 persons who purchased mutual fund unit of Rs. 2 lac or more, bonds or debentures of Rs. 5 lak or more, shares issued by company of Rs. 1 lac or more and bonds issued by RBI of Rs. 5 lac or more;
  • 20,61,443 persons who made payments of Rs. 2 lac or more in a year against their credit card bills;
  • Persons who received interest income of Rs. 50,000 or more from banks;
  • Persons who purchased bullion or jewellery of Rs. 5 lac or more.

Action taken by the Income Tax department

The Income Tax department has already issued notices to more than 12 lac persons who have not filed their Return or who have not disclosed the above transactions in their return. Department is taking strict action against non filers and tax evaders by way of levy of Interest, penalty and launching prosecution in several cases.

Consequences

Apart from mandatory levy of interest, Failure to declare your correct income may lead to penalty upto 300% of the evaded tax and you may also face prosecution.

XPERT Advice

  • Don’t wait for action by the Income Tax Department, act now.
  • Declare voluntarily your correct income and pay tax accordingly.
  • Declare correct particulars of your high value investments and expenditures done during the year in your income tax return and pay tax accordingly.
  • File your income tax return correctly to avoid stringent penal action by the income tax department.

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XPERT CONSULTING – Tax Consultants

E: contact@xpertconsulting.biz

www.xpertconsulting.biz

Categories: Income Tax

View Comments (6)

  • SIR, IT IS HIGH TIME NOW THAT I.T.DEPT., HAS WAKED UP AND INTENDS TO CATCH TAX EVADERS BY INTERNAL SURVEY, WHICH IS A VERY GOOD SIGN FOR TAX CONSULTANTS AS WELL AS HONEST TAX PAYERS. THE DEPARTMENT SHOULD BE CONGRATULATED. HOWEVER, IT IS SEEN FROM THE NOTICES RECEIVED THAT THEY ARE DIGGING AGE-OLD TRANSACTIONS LIKE 2009, 2010 ETC, & THE PERSONS ARE FINDING DIFFICULT TO RUMMAGE THE OLD PAPERS AND RELEVANT DOCUMENTS. INSTEAD, THEY SHOULD START FROM F.YR.2011 ONWARDS SO THAT FILING OF RETURNS OF NON-FILERS WILL BE EASY AND THE DEPARTMENT NEED NOT INITIATE PROCEEDINGS U/S 148 FOR PETTY CASES. LIMIT FOR 10 LAKHS OF S.B.A/C SHOULD BE ENHANCED TO 25 LAKHS, AS SALARIED EMPLOYEES MAINTAINING S,B,A/C WILL ALSO BE HARD-HIT, AS THEIR TDS IS ALREADY EFFECTED BY THE EMPLOYERS.
    K.PREMSAGAR

  • Namaskar
    In my opinion we should come out of the ambit of income tax and all other taxes. We should raise the voice of against the harassment.
    The alternative tax system explained by the Arthkranti Pratishthan is the best way out for all taxation system. Just read the entire proposal for tax and start lobbying for it. All the best.......

  • I PERSONALLY CONGRATULATE THE INCOME TAX DEPARTMENT. Most of the person want to be
    honest. IF the income tax Department catches only dishonest person, and do not harase the the honest and inncocent person, then most of the person shall come forward, and comply the provision of income tax.

  • The Govt. wont allow to earn more or to invest the earned money? What is this per annum limit for every thing, in these days of galloping inflation? Instead curtailing retail inflation, the Govt. resorts to harassments to hide its inefficacy? SB ACCOUNT LIMITATIONS IS INCORRIGIBLE.

  • Sir I am an accountant of a non government organisation. We are working on education,child protection,natural resource managenent issues. We are trying to pay maximumly by cheque,through bank transfar and NEFT or RTGS to our employees & vendors. Some expences we directly pay to parties & some expences we pay through our emploees. Therefore our emplyees have a doubt if income tax dept will harrash them for more banks traansactions in their account.

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