In a move to raise the quality of tax assessments and to reduce avoidable disputes, the income tax department has substantially raised the monetary limit for scrutinising high value investors and spenders who do not file tax returns. The move is part of an action plan prepared by the department to reduce tax disputes while ensuring a 19% growth in direct tax receipts in 2014-15.
The department would therefore consider issuing notices this fiscal to individuals with aggregate savings bank deposit of R25 lakh or above if tax returns are not filed. The limit on aggregate unreported savings deposits was R10 lakh for the notices it had issued in 2013-14.
Similarly, the limit of credit card purchases that would attract the tax man?s attention for not filing returns has been raised to R5 lakh or above for this fiscal from R2 lakh or above last year. The transactions that would be scrutinised this year would be of 2012-13.
Capital market investments including investments in mutual funds, bonds, debentures and shares of
R10 lakh or above could attract a tax notice for not filing returns this year. Last fiscal, such investments had separate sub limits.
In the case of purchase of immovable property, scrutiny would now start at R50 lakh against R30 lakh applied previously.