Revised Form 26AS

Revised Form 26AS effective from 1st June 2020

Revised Form 26AS effective from 1st June 2020

Form 26AS is an ‘Annual Consolidated Credit Statement’ which is issued by the income tax department. Recently, the Ministry of Finance revised Form 26AS terming the same as ‘Annual Information Statement’ and made effective from 1st June 2020.

The revised Form 26AS will have more comprehensive information, making the income tax return filing, processing, and assessment simpler and more effective. The present article highlights the impact of revised Form 26AS along with the relevant newly introduced section 285BB and rule 114-I.

Newly inserted section 285BB and rule 114-I-

Vide the Finance Act, 2020, a new section 285BB has been inserted into the Income Tax Act relating to the ‘Annual Information Statement’. The newly inserted section widened the scope of Form 26AS beyond the information about tax deducted, tax collected, and taxes paid. The provisions of section 285BB are made effective from 1st June 2020.

Accordingly, with the introduction of section 285BB of the Income Tax Act, the provisions of section 203AA would cease to exist.

Further, vide notification no. 30/2020 dated 28th May 2020, the Central Board of Direct Taxes introduced new rule 114-I to the Income Tax Rules, 1962. The provisions of newly inserted rule 114-I are explained hereunder-

ParticularsCorresponding details
An authorized person who is required to upload the information in the registered account of the assessee in Form 26AS.

List of authorized persons-

·       The Principal Director General of Income Tax (Systems).

·       The Director General of Income Tax (Systems).

·       Any other authorized person.

The time limit within which information is to be uploadedWithin a period of three months from the end of the month in which the information/ detail is received by the authorized person.
Information/ details to be uploaded by the authorized person

Information/ details relating to following are to be uploaded-

·       Tax deducted or collected at source.

·       Specified financial transaction.

·       Payment of taxes.

·       Demand and refund.

·       Pending proceedings.

·       Completed proceedings.

Additionally, the rule 114-I empowers the authorized person to upload the following information in the annual information statement (i.e., Form 26AS)-

  • The information received from any officer, body, or authority performing any function under any law; or
  • The information received under an agreement stated in Section 90 or Section 90A of the Income Tax Act, 1961; or
  • The information received from any other person to the extent the same is in the interest of the revenue.

Impact of revised Form 26AS-

The impact of revised Form 26AS, effective from 1st June 2020, is explained hereunder-

  • Form 26AS will now contain additional personal details like mobile no., e-mail id, and Aadhaar number of the taxpayer.
  • Previously Form 26AS contained only details of tax deducted, tax collected, and income tax payment. However, now the Form 26AS would also cover details like-
    • Specified financial transactions, such as share transactions, property purchase, taking /accepting loan or deposits of value above the prescribed limit, etc.
    • Pending as well as completed proceedings.
  • Availability of almost all the information in one place, revised Form 26AS would fully assist the income tax authority to compare the details available in Form 26AS vis-à-vis details provided by the tax payer in the income tax return. Thus, the revised Form 26AS would undoubtedly make the e-assessment quite easy and quick.
  • Importantly, now onwards, Form 26AS is required to be updated regularly within 3 months from the end of the month in which the authorized person receives the details/ information.
  • Regular updation of Form 26AS would unable the taxpayer to identify any incorrect information reported in Form 26AS and, accordingly, the taxpayer can take precise actions to correct the same.
  • With the implementation of new comprehensive Form 26AS, it would now be difficult for the taxpayer to hide important financial transactions since the same would be regularly updated in Form 26AS.

Post by poonamgandhi

CA Poonam Gandhi is a Chartered Accountant and a Lawyer. With a wide practice experience and deep understanding of different laws and taxes, she has been an independent professional writer in the field of taxation, finance and laws.