Form 26AS, also known as Annual Tax Statement under section 203AA, mainly provides details of tax deducted at source (TDS), tax collected at source (TCS), details of tax paid during the financial year. It is a digital statement which can be viewed or downloaded by the assessee from the Income Tax e-filing Portal.
Legal Provisions and Amendments
Section 203AA of the Income Tax Act provides that the prescribed Income Tax Authority or a person authorized by such authority shall within the prescribed time after the end of each financial year (FY 2008-09 onwards) prepare and deliver to every person from whose income TDS has been deducted or in respect of whose income tax has been paid, a statement in prescribed form specifying the amount of tax deducted and paid and such other particulars as may be prescribed.
Finance Act, 2020 has omitted section 203AA with effect from 1st June, 2020 and has inserted a new section 285BB with effect from the same date, thereby replacing the existing Annual Tax Statement with the new Annual Information Statement. This amendment will increase the amount of information provided by the Form 26AS.
Section 285BB provides that the prescribed Income Tax Authority or the person authorized by such authority shall upload in the registered account an Annual Information Statement, in such form and manner, within such time and along with such information which is in the possession of an Income Tax Authority, as may be prescribed. The format of the new Form 26AS has been notified on 28th May, 2020 vide Notification No. 30/2020 through the insertion of Rule 114I of Income Tax Rules.
Current information provided by Form 26AS
Under the existing system of Annual Tax Statement, the following information is provided in Form 26AS:
- Details of tax deducted at source (TDS)
- TDS under section 194IA on sale of immovable property
- TDS under section 194IB on rent of property
- Details of TCS
- Tax paid other than TDS & TCS
- Details of refund paid
- Details of AIR (Annual Information Return) transactions, if any
New Format of 26AS
The newly introduced system of Annual Information Statement is aimed at providing a wide range of information in one statement.
Benefits of the New Form 26AS
- Income Tax Return filing will become much easier as more information can be auto-filled from the Form 26AS
- More details will be made available at one place
- Easier to complete e-assessments
Disclosures under the new system
The statement will now quote the Aadhaar Number of the assessee apart from the PAN. The form will also disclose:
- Information relating to tax deducted or collected at source (TDS/ TCS)
- Information relating to specified financial transactions (SFT)
- Information relating to payment of taxes
- Information relating to demand and refund
- Information relating to pending proceedings
- Information relating to completed proceedings
- Any other information relating to Rule 114I (2)
Rule 114I (2) provides that the Central Board of Direct Taxes can upload any information received from any authority under an agreement referred to in section 90 or 90A of the Income-tax Act. These agreements are agreements entered into with foreign countries to share financial information or for avoidance of double taxation.
Availability of New Form 26AS
Form 26AS will be available in the new format from 1st June, 2020 onwards. It can be downloaded by the assessee from the e-filing portal. The information in the form will be updated every 3 months from the date of receipt of such information.
Specified Financial Transactions (SFT)
The new format of Form 26AS will disclose the details of the specified financial transactions. Section 285BA (3) provides the meaning of Specified Financial Transactions as follows:
- Transaction of purchase, sale or exchange of goods or property or right or interest in a property
- Transaction for rendering any service
- Transaction under a works contract
- Transaction by way of an investment made or an expenditure incurred
- Transaction for taking or accepting any loan or deposit.
Proceedings pending and completed
The new form 26AS will report on the details of pending as well as completed proceedings of the assessee. This will include any appeal pending before the CIT (Appeals) or the ITAT or High Court or Supreme Court. It will also include revision application before CIT.
Demand and Refund
Under the existing system we already get details of any refund paid during the year in Form 26AS. Under the new format details of both income tax demand and income tax refund shall be made available.
Under the new section 285BB, the Principal Director General (PDG) or the Director General (DG) have been given power to disclose the following:
- Any information received from any officer, authority or body performing any function under any law. This is a very powerful provision through which the PDG or DG can provide information relating to the assessee in matters of proceedings under other laws such as the Benami Property Act or GST Law, etc.
- Any information received under a Double Taxation Avoidance Agreement entered by the Indian Government with the Government of any other country or territory.
- Any information received from any other person to the extent as the PDG/ DG may seem fit in the interest of the revenue.