Transactions Tracked by Income Tax Department

Taxpayers need to keep in mind high-value transactions they made while filing their income tax returns.

The income tax department is using analytics to scrutinize data to find out people who have not filed income tax returns (ITR) or under-reported income despite doing a high-value transaction.

Let’s understand what these high-value transactions are and how the income tax department gets information about them.

• Cash Deposits in Banks : Banks/Post offices will have to report cash deposits aggregating Rs 10 lakh or more in a financial year in one or more accounts (other than Current Account / Time Deposit) of a person.
• Term Deposits in Banks :  Banks/Post offices will have to report cash deposits aggregating Rs 10 lakh or more in a financial year in one or more Time Deposit accounts of a person .
• Deposits in Current Accounts : Banks will have to report cash deposits or withdrawals aggregating to Rs 50 lakh or more in a financial year in one or more Current Account of a person.
• Immovable Property : The Registrar of properties will have to report purchase & sale of all immovable property exceeding Rs 30 Lakh to the Income Tax authorities.
• Persons liable for audit u/s 44 AD  : The persons will be required to inform the tax department of receipt of cash payment exceeding Rs 2 lakh for sale of any goods or services.
• Banks will have to report any cash payment of Rs 10 lakh or more in a financial year for purchase of bank drafts or pre-paid instrument issued by RBI.
• Credit Card Bill Payments : Banks will have to report if you make Credit Card bill payments of more than Rs 1 Lakh per annum in cash mode (or) more than Rs 10 Lakh through Cheques / RTGS etc.
• Investments in Financial Securities : A company has to report receipt of Rs 10 lakh or more from a person/an investor in a financial year for acquiring bonds, debentures, shares or mutual funds.

Statement of Financials Transactions

Reporting Authorities like banks, post office, Registrars, companies are required to intimate about high value transactions to Director of Income-tax by filing Form 61A called Statement of Financial Transaction. Through this Income-tax Department comes to know about your high-value transactions and then it checks whether such person has filed return of income or not. If return is filed whether income disclosed is true and taxes have been paid correctly or not.

For more details, you may contact at nitesh.chartered@gmail.com or 91- 8209904900.