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Annual Information Statement Replaces Form 26AS


Annual Information Statement Replaces Form 26AS

Finance Act, 2020 had inserted a new section 285BB in the Income Tax Act 1961. The said section contains that a prescribed income-tax authority or any person authorized by such authority shall upload an annual information statement in the registered account of the taxpayer in such form and manner, within such time and along with such information that the income tax authority possesses, as may be prescribed.

In accordance with section 285BB, CBDT has passed Notification 30/2020 on 28th May 2020 through which the existing Form 26AS has been replaced with a new version of Form 26AS containing a statement named Annual Information Statement (AIS). Rule 31AB which dealt with Form 26AS has been omitted and a new rule 114I has been inserted. The new statement is effective from 1st June 2020.

Rule 114I states that the Principal Director-General of Income Tax (Systems) or the Director General of Income Tax (Systems) or any person authorized by them shall upload an Annual Information Statement in Form 26AS containing the following information, which is in his possession within three months from the end of the month in which the information has been received by him:

Sl. No. Nature of Information
1 Information regarding tax deducted or collected at source
2 Information regarding specified financial transaction
3 Information regarding payment of taxes
4 Information regarding demand and refund
5 Information regarding pending proceedings
6 Information regarding completed proceedings

Specified financial transactions have been prescribed in Section 285BA. The section states that following transactions shall be known as specified financial transactions (SFTs) and shall be reported by specified persons in the Annual Information Report (AIR):

  • Purchase, sale or exchange of goods, property, right or interest in a property
  • Rendering of any service
  • Works contract
  • Investment made or any expenditure incurred
  • Taking or accepting any loan or deposit

The section also provides that the Board may prescribe different values for different transactions undertaken by different persons. So, all the reportable SFTs shall now form part of the Annual Information Statement in Form 26AS.

Rule 114I also provides that any information received under a DTAA with any country or specified territory or association or any information received from any other person if found to the interest of the revenue has to be uploaded in the annual information statement. Thus, now information exchanged with the government under a DTAA shall also be incorporated in the AIS.

Apart from this specific information, some general information also forms part of the Annual Information Statement, namely:

  • Permanent Account Number
  • Aadhaar Number
  • Date of Birth/ Incorporation
  • Mobile No.
  • Email Address
  • Address

Thus, you shall now witness a new version of Form 26AS containing the Annual Information Statement. While the old Form 26AS contained only the information about tax deducted or collected, the new form is more comprehensive and in addition to the information of tax deducted and collected it also contains other significant information like that of SFTs, information obtained under DTAA, details of pending and completed proceedings, and so on. The new statement is aimed to bring more transparency in the tax regime and curb tax avoidance practices. It is expected to widen the tax base and discourage the taxpayers to hide information about the financial transactions undertaken by them.