Transactions reported to Income Tax Department

Under income tax laws  institutions are required to report the details of those transactions which you have entered into or registered with them. All the banks, mutual funds and companies issuing shares are required to submit the details. Besides, the office of the registrar where your sale and purchase transaction of immovable properties are registered, is also required to send the details of such transactions to the income tax department. These establishments have your PAN and other details, so there is virtually no way one can sneak past them. The following transactions are required to be informed to the Income Tax Department

1. Cash deposits aggregating to Rs. 1,000,000 or more in a year in any of your savings account in the bank.Banks also includes cooperative banks. Infact it applies any bank or banking institution which comes under the section 51 of Banking Regulation Act, 1949 (10 of 1949). Banks are not required to report in cases where cash exceeding Rs 10 lakh has been withdrawn from the savings account but the cash deposits have not crossed the threshold limit during the financial year.
2. The transaction of payments for credit card if the aggregate payment made during the financial year is Rs 2 lakh or more during the financial year.
3. Investments of Rs 2 lakh (200,000) or more in Mutual Fund
4. Investments of Rs 5 lakh (500,000) or more in bonds or debentures issued by a company or institution
5. Investments of Rs 1 lakh (100,000) or more in the shares issued by a company
6. Purchase or Sale of any immovable property valued at Rs 30 lakh (30,00,000) or more
7. Investments of Rs 5 lakh (500,000) or more in a year for investment in bonds issued by Reserve Bank of India

The values of the transactions mentioned above have to be considered as aggregate in a year and not per transaction.

“You cannot hide any longer …therefore, today the best policy is to admit your income and pay tax” Finance Minister  P Chidambaram had said in Mar 2013.  P Chidambaram said the tax department has information about people’s expenditure patterns and their financial transactions.We have issued notices to 35,000 people saying that on the basis of information we have, you should have filed your returns. Another 35,000 notices are going next week “No. In income tax there is no case for amnesty. Because now almost all returns are online except a small category which was exempt. We have a huge amount of data which is being mined. Therefore, there is no case for amnesty today”

Almost 23 crore of such high-value transactions are under the scanner and notices have already been dispatched to thousands of taxpayers. The notice typically asks the taxpayer to respond in writing. His personal presence is not required. If the system detects a mismatch in income, investments and expenses, it will automatically pick the return for scrutiny.

Interim Budget highlights

·         No change in direct taxes

·         Excise cut on capital goods cut from 12% to 10%

·         Excise duty cut on small cars reduced from 12% to 8%

·         Excise duty for SUVs cut from 30% to 24%

·         Excise duty for large and mid-segment cars cut to 20%

·         Excise duty on mobile handset will be 6 %with CENVAT credit 0r 1% without CENVAT Credit

·         customs duty structure on non-edible grade industrial oils and its fractions, fatty acids and fatty alcohols at         7.5 percent.

·         To encourage domestic production of specified road construction machinery, withdrawal of the exemption             from CVD on similar imported machinery.

·         loading, unloading, packing, storage and warehousing of rice exempt from service tax.

·         services provided by cord blood banks are also healthcare services and be exempt from service tax.