Arjun (Fictional Character): Krishna, the festival of Ganesh Chaturthi has arrived. What does Ganpati Bappa have to address the taxpayers this year?
Krishna(Fictional Character): Arjuna, the festival of Ganesh Chaturthi has brought joy in the environment. Recently, the taxpayer's charter was introduced, wherein the commitment of Income Tax department & expectations of the taxpayers have been set. Not only this, but some measures of widening the tax base has been proposed, by expanding the scope of reporting of transactions (SFT). This shall ensure better compliance & transparency. Here, Ganpati Bappa being the Vighnaharta for all taxpayers, will guide about the transactions included in extended reporting of SFT.
Arjun (Fictional Character): Krishna, what precautions do Ganpati Bappa asks the taxpayers to take, in order to save taxpayers from 12vighnas?
Krishna(Fictional Character): Arjuna, the SFT return is mandatory to be filed by all persons having bank transactions above Rs.30 lakhs, all professionals and business having turnover above Rs 50 lakhs & payment of rent above Rs. 40,000.
Ganpati Bappa asks taxpayers to be careful about mandatory reporting the following transactions in the SFT return :
- Payment to hotels above Rs. 20,000
- Payment of property tax above Rs.20,000
- Payment of health insurance premium above Rs.20,000
- Payment of rent above Rs.40,000
- Payment of life insurance premium above Rs.50,000
- Electricity consumption above Rs.1 lakh
- Payment of educational fee/donations above Rs.1 lakh p.a
- Purchase of jewelry, white goods, painting, marble, etc. above Rs.1 lakh
- Deposit/credits in the current account above Rs.50 lakh
- Deposit/credits in the non-current account such as savings accounts above Rs.25 lakh
- Domestic business class air travel or foreign travel
- Share transactions/D-MAT accounts/Bank lockers
The taxpayer has to be mindful before paying any entity for the above transactions, as now, the entity shall be reporting the government about these transactions too.
Arjun (Fictional Character): Krishna, what should the taxpayer learn from this?
Krishna(Fictional Character): Arjuna, the taxpayer should carefully follow the enlightenment of Ganpati Bappa, and accordingly report the given 12 transactions in their SFT returns, otherwise the Vighnas of scrutiny & assessments will catch the taxpayers. This reporting shall take our taxation system a step ahead in achieving the PM’s aim of "Honouring the Honest".