What is Form 26AS?

Form 26AS [ Annual Information Statement ]

Form 26AS is a statement which is maintained by the Department of Income Tax on an annual basis. Form 26 AS contains the details of the tax credit in an account or appearing in the Permanent Account Number of the respective assessee as per the records of the Department of Income Tax which can later be claimed by the taxpayer. It is prepared under rule 31AB of the Income Tax Act, 1961**.

**via Notification No. 30/2020 dated 28th May 2020, Rule 31AB has been omitted and Rule 114-I has been inserted after Rule 114H to share annual financial information in respect of taxpayer not only Taxes paid by TDS/TCS or otherwise.

What is Tax Credit?

An assessee can pay income tax either in the form of TDS i.e. Tax Deducted at Source, TCS i.e. Tax Collected at Source or Advance Tax. The total tax paid by an assessee is recorded by the Income Tax Department which is called Tax Credit which can be in any of the three forms that are TDS, TCS, and Advance Tax. The department allows the taxpayer to claim the credit of taxes as reflected in his Form 26AS.

What to do if the actual TDS differs from TDS reflected in Form 26AS?

If the actual TDS deducted as reflected in the TDS Statement differs from the TDS reflected in Form 26 AS. The taxpayer will not be eligible to claim the amount of actual TDS. The discrepancy may occur because of one of the following reasons:

1. Non-furnishing of TDS details by the deductor to the Department of Income Tax.
2. Incorrect Permanent Account Number.
3. Incorrect amount entered in TDS Return.
4. Incorrect Assessment Year.
5. Failure of the deductor to deposit TDS on time.
6. Omissions in the TDS return.
7. TDS deducted and quoted mismatch.

In case of discrepancy, the deductee should approach the deductor and request him to take the necessary steps to rectify the discrepancy due to the reasons as mentioned in the Justification Report. The deductor may file the TDS/TCS correction statement ( i.e. Submission of Conso File) and correct the same.

Old Form 26AS V/S Newly introduced Form 26AS

Form 26AS will now be a complete profile of the taxpayer which will have comprehensive information on taxes paid, details of pending and completed income tax proceedings, the status of income tax demand, and refund among others.

Form 26 AS can be obtained by logging into E-portal of Income Tax Department
https://www.incometaxindiaefiling.gov.in/home

26AS under the old scheme i.e As per Rule 31AB

26AS under the new Rule 114-I to be effective from June 1st 2020

Important changes and updates that will be observed in Form 26AS from 1st June 2020 Onwards:

• New form 26AS will also provide information in respect of "Specified financial transactions" which include

○ Purchase/ sale of goods/property/ services,
○ Works contract,
○ Investment and Expenditure,
○ Taking or accepting any loan or deposits of such value as may be prescribed but not less than of Rs 50,000.

• Information about

○ Income tax demand,
○ Refund,
○ Proceedings pending, and
○ Proceedings completed which may include assessment, reassessment under section 148,153A 153C, revision, appeals shall also be shared in this form 26AS.

• Information on 26AS will be updated regularly within 3 months from the end of the month in which such information is received.

• Form 26AS will now be a complete profile of the taxpayer for that particular year as against earlier form 26AS which just provided the information about taxes paid by way of TDS/TCS or self-assessing. This form will also have mobile no, email I’d and Aadhaar no. of the taxpayer.

• Updates have empowered CBDT to authorise DG Systems or any other officer to upload in this form, information received from any other officer, an authority under any law.

• Any adverse action initiated or taken or found or order passed under any other law such as custom, GST, Benami Law etc. including information about Turnover, import, export etc. will also be put in this form 26AS so that not only the concerned taxpayer but also all the Income Tax authorities will know and have access to such information.

• This form 26AS will also provide Information received by the Tax Department from any other country under the treaty /exchange of information about income or assets of the taxpayer located outside India.

• Banks, financial institutions or any other authority or customer, buyer etc. while carrying out due diligence of the person/ corporate concerned will now ask for form 26AS so as to be sure that there are not any major issues about such person/corporates. Hence making it difficult for the taxpayer to hide relevant Info. from them regarding any past or ongoing proceedings against any law or tax disputes, demands etc

Extract of Newly Inserted Section 285BB of Income Tax Act, 1961 w.e.f 1st June 2020

The prescribed income-tax authority or the person authorised by such authority shall upload in the registered account of the assessee 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.

Explanation.- For the purposes of this section, "registered account" means the electronic filing account registered by the assessee in the designated portal, that is, the web portal designated as such by the prescribed income-tax authority or the person authorised by such authority.’