This article is written by Rajendra Utpat, pursuing a Certificate Course in Advanced Corporate Taxation from LawSikho.

What is a 26 AS statement

26 AS is an annual tax statement which shows tax deducted, collected at source and/or tax paid(such as advance tax, self-assessment tax). This statement was introduced u/s 203AA of the Income Tax Act 1961 vide Finance (No.2) Act 2004 and the second proviso to sub-section (5) of section 206C, read with rule 31AB of the Income Tax Rules 1962.

The objective of this statement is to provide the following information to the taxpayer against taxpayer’s PAN number:

• who has deducted /collected tax sources on his/her behalf.
• tax paid by taxpayers such as advance tax, self-assessment tax.

So that taxpayer can take credit of tax deducted/collected and/or tax paid while filing his/her income tax return.

Taxpayers can access, view and download 26 AS  from income tax websites either through www.incometaxindiaefiling.gov.in or www.tdscpc.gov.in.

26 AS statement before the amended Finance Act 2020

Old 26 AS statement used to contain the following information:

1. Basic information of taxpayer such as:

1. PAN Number of taxpayer
2. Current status of PAN
3. Financial year
4. Assessment year
5. Name of the assesses
6. Address of the assesses
   

B. Other information such as:

Sr. No	Part No under old 26 AS statement	Particulars
1	Part A – Details of Tax Deducted at Source	Name of deductor TAN of deductor Total amount paid/credited Total tax deducted Total TDS deposited
2	Part A1 – Details of Tax Deducted at Source for 15G/ 15H	Same details as above except tax deducted and deposited amount will be NIL because of submission of form 15G or 15H by taxpayer.
3	Part  A2 – Details of Tax Deducted at Source on Sale of Immovable Property u/s 194IA/ TDS on Rent of Property u/s 194IB (For Seller/Landlord of Property)	Acknowledgement number of TDS certificate Name of deductor PAN of deductor Transaction date Total transaction amount Total TDS deposited This is applicable where taxpayer as sells the property and TDS has been deducted on sale price by buyer of the property.
4	Part B – Details of Tax Collected at Source	Name of collector TAN of collector Total amount paid/debited Total tax collected  Total TDS deposited Here tax collected by the taxpayer as a seller needs to be shown.
5	Part C – Details of Tax Paid (other than TDS or TCS)	If a taxpayer has deposited advance tax, self-assessment tax etc then details such as tax amount, challan number, BSR code of bank, date of deposit etc needs to be given here.
6	Part D – Details of Paid Refund	If a taxpayer received refund of tax paid earlier years then details such as assessment year for which refund is given, amount of refund, amount interest on refund and date of payment of refund by income tax department needs to be shown here.
7	Part E – Details of AIR Transaction	Type of transaction Name of AIR filler Transaction date Single/joint party transaction Number of parties Amount  Mode of transaction Here high-value transactions are done by taxpayers such as mutual fund purchase, property purchase, corporate bond purchase etc.
8	Part F – Details of Tax Deducted at Source on Sale of Immovable Property u/s 194IA/ TDS on Rent of Property u/s 194IB (For Buyer/Tenant of Property	Acknowledgement number of TDS certificate Name of deductee PAN of deductee Transaction date Total transaction amount Total TDS deposited This is applicable where the taxpayer has bought the property and TDS has been deducted on purchase price by the taxpayer.
9	Part G-TDS Defaults(Processing of Statements)	It contains defaults related to processing of quarterly filed TDS statements. Here are the following information that needs to be given: Financial year Amount of short payment, short deduction and interest thereon Late filing fees etc

26 AS statement post amendment Finance Act 2020

Finance Act 2002 deleted section 203AA of the Income Tax Act 1961 and made radical changes in existing 26 AS w.e.f June 01, 2020. All taxpayer’s data will be available in a new Form 26 AS. It will contain part A and part B.

The government is yet to notify or clarify the specified financial transactions reportable in the new Form 26AS. The new form is in line with the budget 2020 announcement to facilitate compliance and correct payment of taxes.

Comparison between old 26 AS Statement and new 26 AS statement

Purpose of new form 26 AS

A comprehensive new form 26 AS will provide detailed information about the entire tax profile of taxpayers which will help honest taxpayers to file their income tax return accurately. It will desist taxpayers who conceal financial transactions in their income tax return. This was the purpose behind bringing out new form 26 AS as it is evident by press release dated 18.07.2020 by the department.

Implications of new form 26 AS

New form 26 AS will have a far reaching impact on taxpayers as follows:

1. Now it will also contain Aadhar number, date of birth, email address and mobile number of the taxpayer which was not there in earlier 26 AS statement.
2. New from 26 AS will not be a one time affair as it will be updated regularly within 3 months from the end of the month in which information is received. It will always live.
3. It will be more comprehensive and have a complete profile of taxpayers.
4. This statement will now be used as KYC as banks, financial institutions, customer, buyer and any other authority will demand form 26 AS from taxpayer while dealing with taxpayer to know about any major issues about taxpayer. This will make it difficult for taxpayer to hide tax related information with banks, financial institutions, any authority etc.
5. Taxpayers need to be more cautious while filing their income tax return as they need to cross verify the information in form 26 AS with their books of accounts and/or documents which have been relied upon to prepare their return.

Conclusion

The income tax department has made radical changes in existing form 26 AS to provide an exhaustive tax profile of taxpayers including his/her high value financial transactions making it difficult for taxpayers to hide any information from the income tax department. Now taxpayers need to consider information contained in form 26 AS while filing return so that accurate return can be filed.

The income tax department is using new edge technology to gather information about taxpayers by way of gathering information with other authorities such as banks, financial institutions, GST departments etc, which will go a long way to ensure better and transparent compliance by taxpayers.

In the end, I would like to say that in the near future it will be interesting to see how new 26 AS will have an impact on the assessment income tax return filed by taxpayers.

References

Kanga & Palkhivala’s The Law and practice of Income Tax by Arvind P Datar.

www.bcasobline.org

www.cleartax.in

www.taxguru.in

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