With the due date for filing income tax return (ITR) for AY2017-18 approaching on July 31, 2017, there is very little time to file your tax return. However, for an individual tax payer, filing a tax return can be a complicated process with all the detailed reporting requirements. Moreover, before filing your tax return, you also need to check various documents to know the details of your income as well as tax deducted at source (TDS). One such important document is Form 26AS which, according to tax experts, must be viewed before filing the ITR to cross check the details of tax deducted.
What is Form 26AS
Form 26AS is a statement issued under section 203AA of the Income Tax Act. It has details of tax deducted at source (TDS) by one’s employer (on an employee’s salary), bank (on interest), tenant (on the rent), among others. The Tax Credit Statement also contains the tax collected, taxes paid by the taxpayer and refunds received during the financial year.
“Details of the high-value transactions in respect of shares, mutual funds, and credit cards are also reflected in this statement based on the Annual Information Report filed by different entities. If an assessee has sold any fixed assets and TDS has been deducted by the buyer on the consideration, then the same also appears in the Form 26AS. Every taxpayer, therefore, should verify whether the TDS deducted and taxes paid match with details in the Form 26AS,” says By Archit Gupta, Founder & CEO of ClearTax.in.
Structure of Form 26AS
Part A – Details of Tax Deducted at Source: This part contains all the TDS deducted on one’s income. It can be TDS on salary, house rent, commission, interest on deposits etc.
Part A1 – Details of Tax Deducted at Source for 15G/15H: When a person submits Form 15G or Form 15H to the bank for non-deduction of TDS, the interest amount if any will reflect in this section.
Part A2 – Details of Tax Deducted at Source on Sale of Immovable Property u/s 194IA (for seller of property)
Part B – Details of Tax Collected at Source
Part C – Details of Tax Paid (other than TDS and TCS) – All taxes paid such as advance tax, self-assessment tax and tax on regular assessment appear in this section.
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Where can you get the statement from
# Form 26AS can be downloaded from the TRACES website (https://contents.tdscpc.gov.in) or via the net banking facility of authorised banks.
# The password for opening Form 26AS is one’s Date of Birth (in DDMMYYYY format).
According to tax experts, Form 26AS is a good starting point while getting yourself prepared for filing income tax return. That is because this Form shows the various heads of income on which tax is deducted at source by the payer of income. It has record of both the income and the tax deducted at source on such income. Form 26AS also contains the details of any advance tax or self-assessment tax paid or any income tax refund received from the Income Tax Department during the relevant FY.
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“Additionally, this form reflects the details mentioned in the Statement of Financial Transaction (SFT) – earlier called as Annual Information Return (AIR). SFT is filed by different entities stating the details of specific transactions such as high value investments, credit card expenses, cash deposits and purchase or sale of immovable property, etc. Any mismatch between the ITR and Form 26AS may lead to further inquiry from the Income-Tax Department. Therefore, it is necessary to check the details from Form 26AS before filing the tax return,” informs Puneet Gupta, senior tax professional, EY India.