The Income Tax Service recently updated the compliance portal with the new Annual Information Statement (AIS). This is a financial statement meant to simplify your tax filing process by making financial transactions available in one place.
However, many taxpayers are unsure whether the new AIS will make their life easier or harder. On top of that, there is confusion as to whether AIS will replace Form 26AS or be different from it. So to make life easier for taxpayers and resolve their questions, here is a guide to help you.
What is AIS?
The Annual Information Return (AIS) is basically a utility / form available on the income tax website that reveals all of the taxpayer’s financial and tax information. It is an extension of Form 26AS, which contains information about the SFT and the taxes levied throughout the year.
The new AIS now includes information like interest, securities transactions, mutual fund transactions, dividends, overseas remittance information, and more. It was introduced with the aim of removing duplicate information, if any. If the taxpayer believes that the information on the form is duplicate, incorrect, relates to another year, or there is an error, then the taxpayer can submit their comments. In AIS, the reported value and the value following the return will be displayed separately.
The main objectives of AIS are to display all of the information for the taxpayer; encourage voluntary compliance and facilitate the pre-declaration of smooth returns; and discourage non-compliance.
In addition to the online format, the ITD has made an AIS utility available to taxpayers to help them provide feedback to the tax department also offline. Taxpayers could download AIS in PDF, JSON, and CSV formats from the website.
TIS and AIS are almost similar with one exception. TIS will only display a summary of transactions displayed in AIS, while AIS will contain a detailed statement of transactions.
Now AIS is divided into two parts, Part A and Part B. Part A includes information such as date of birth, PAN, cell phone number, address and other details. Part B includes details regarding, but not limited to, specified financial transactions, payment of tax, outward forwardings, TDS, and interest on refunds.
The difference between AIS and Form 26AS
While Form 26 AS only mentions high value transactions and withholding tax, AIS includes comprehensive data on savings bank interest, deposit interest, capital gains, overseas remittances and equity transactions. It is important to note that AIS only displays information available to the Income Tax Service. Transactions that are not available with them must be reported by the taxpayer accurately to avoid any penalties or notices.
The AIS would make the filing of an income tax return (ITR) much easier by consolidating more details than the 26AS form. It should be noted that the 26AS form on the portal will continue to exist until the new AIS is fully operational.
How to display and read AIS
To view your AIS, you must first log into the Income Tax Portal. Once connected, click on the Services tab then on “Annual information declaration”. You will see a separate page with three tabs.
➔ AIS (There will be two options: TIS and AIS)
The taxpayer can easily consult his AIS and all the associated information in these sections. In addition, taxpayers can study the AIS documents (AIS manual, guide and FAQ) in the “Resources” section or contact the help desk through the “Help” section on the AIS home page if they have any questions. .
The bottom line is that with all the relevant data in one piece, the tax return will be considerably easier for taxpayers, and the likelihood that critical information will be ignored in the RTI will be very minimal.
The author, Abhishek Soni, is co-founder and CEO of Tax2win.in. Opinions expressed are personal