Annual Information Statement: Huge Utilitarian for Taxpayers

The annual information statement has been recently launched by Income Tax Department to ease the compliance burden & increase transparency for taxpayers. It is an extensively summarized view of the transactions of the taxpayer. The income tax department collects information from all the financial entities, stockbrokers & mutual fund houses & presents the financial transactions fetched based on Permanent Account No of each taxpayer in the Annual Information Statement.

What Does Annual Information Statement comprise of?

Annual Information Statement: This statement is divided into 2 parts

PART A & PART B

PART A: This part displays general information regarding taxpayers like PAN, Date of Birth, Aadhar Number, etc

PART B: This part contains a comprehensive view of all the transactions related to the taxpayer. These transactions relate to

1. TDS/TCS
2. Dividend
3. Bank Interest (Including Saving Interest)
4. Shares
5. Bonds
6. Mutual Fund
7. Foreign Remittances
8. Tax Demand/Refund

Where can you access & download this statement?

Step 1: Log in to the Income Tax Portal

Step 2: Go to the Services Tab & scroll down to Annual Information Statement

You will be redirected to the new portal & on the new portal scroll to the second option, Annual Information Statement

Step 3: On this window, you will be displayed two blocks, Taxpayer Information Statement & Annual Information Statement

Click on Annual Information Statement

Some of the snippets of AIS are

You can also download this statement & view it offline. The statement is password protected. The password for this statement is PANDOB(PAN followed by DOB)

What is Taxpayer Information System?

All the information which has been comprehensively provided & validated in the Annual Information Statement will then be transferred to TIS i.e., Taxpayer Information System which is a summarized version of AIS relevant for tax filing. This data can then be imported to return filing forms to ease the compliances burden of taxpayers. 

How to submit feedback in AIS?

The taxpayer can submit feedback through online & offline mode. The feedback has to be submitted only on the AIS portal.

Go to the AIS. You can refer to any of the sections such as TDS/TCS, payment of taxes, etc

For example, as displayed below in the SFT section, click on the Information tab. Upon expansion of the same, you have to choose the Optional Button to submit the feedback.

You will be asked feedback type:

The information will be reflected in the modified figure in bracket

This modified value will be displayed in Taxpayer Information Summary

How is 26 AS different from AIS?

• 26 AS contains information related to income on which TDS/TCS has been deducted in a Financial Year
• Further information related to the purchase of mutual funds, foreign remittances, etc will be displayed in 26AS only if the income/transaction surpasses a specified limit
• AIS provides a comprehensive view on information regarding
• TDS/TCS
• Dividend
• Bank Interest (Including Saving Interest)
• Shares
• Bonds
• Mutual Fund
• Foreign Remittances
• Tax Demand/Refund

Furthermore, this information is provided irrespective of the fact that TDS/TCS has been deducted from this transaction which gives a huge benefit to the Annual Information Statement

• 26 AS does not have a modification option for the taxpayer whereas AIS has a modification option for the taxpayer

So, does that mean 26AS will be disabled? No 26AS will continue to stay until AIS is completely validated & becomes operational

Which form should a taxpayer refer to at the time of filing in ITR?

In case of variation between TDS & TCS or the details of tax paid as displayed in Form 26 AS versus AIS, the taxpayer has to rely on the information displayed in Form 26AS for return filing

How will AIS help in ease of compliances & filing of returns?

The answer to the question is that AIS is an indirect help to the taxpayers. AIS not only provides a comprehensive overview of the information but also gives a modification option to the taxpayer in case the taxpayer feels that the information is not correct or the numbers are distorted. The taxpayer can then provide the modified feedback in the Annual Information Statement which will then be verified by the Income Tax Dept & displayed accordingly. This information will be imported to the Taxpayer Information System which will then be used for filing returns for taxpayers.

With the ease of compliance, there comes responsibility as well. Now the taxpayers have to report income to the last penny as information related to a dividend of Rs 1 also will be displayed in the AIS.

This functionality is available for Financial Year 2020-21 as well. It can be used for the filing of returns by taxpayers. It can also be used by those who have already filed their returns. They can use this to cross-verify any income which has not become part of their return & revise the returns with the appropriate information.

All in all, it is a great move by the Income Tax Department to ease the compliance of filing income tax returns by presenting detailed information in AIS & giving an option of feedback to the taxpayers to correct the information.