How to make use of Form 26AS for filing my ITR?

Form 26AS is an annual tax credit statement that gives the complete details of tax credited against your PAN. Form 26AS is a vital and hand-holding tool to which you can refer for your income details and also for the taxes that are paid by you on such income and the tax deducted at source by the deductor such as employer, bank, etc. As a taxpayer, you can access or download Form 26AS from the Income Tax Department’s e-filing website.

Here is how you can download Form 26AS:

Logon to www.incometaxindiaefiling.gov.in
Go to the ‘My Account’ menu and click on ‘View Form 26AS (tax credit)’ link
Click on ‘confirm’ tab and you will be redirected to TDS-CPC Portal
Click on ‘View Form 26AS (Tax Credit)’
Choose the ‘Assessment Year’ and ‘View Type’
Click on download to download Form 26AS

There have been significant changes made into Form 26AS which makes it even more important for filing your income tax return. The new Section 285BB introduced by the government in the Income Tax Act, 1961 via the Finance Act, 2020 has implemented revised Form 26AS. With this regard, the Central Board of Direct Taxes (CBDT) has notified a new Form 26AS (annual information statement) via a notification dated 28th May 2020. The revised form is more informative and comprehensive in nature which gives a complete snapshot of the taxpayer's profile for the particular financial year.

Changes in the New Form 26AS

New Form 26AS not just contains the details of taxes paid, tax deducted at source and tax collected at source, but also contains details of specified financial transaction, pending proceedings and completed proceedings also. New Form 26AS has two sections – Part A and Part B.

Part A of the Form 26AS contains general information of the taxpayer mentioned below:

Permanent account number (PAN)
Name
Address of Assessee

Part B of the Form 26AS contains the below-mentioned information:

Information relating to tax deducted or collected at source
Information relating to a specified financial transaction
Information relating to the payment of taxes
Information relating to demand and refund
Information relating to pending proceedings
Information relating to completed proceedings
Any other information in relation to sub-rule (2) of rule 114-I

How can you use Form 26AS for filing income tax returns?

Form 26AS is a handy document or statement that you can refer to while filing your income tax return. Here is how the Form 26AS can help you file your income tax return:

Verify information relating to a specified financial transaction

Under section 285BA of the Income Tax Act, 1961, some specified financial transactions will now be part of the revised Form 26AS. Following are the specified financial transactions that are now a part of Form 26AS:

Cash payment aggregating to INR 10 lakhs or more in a financial year for the purchase of pay orders or bank drafts
Cash payment aggregating to INR 10 lakhs or more in a financial year for the purchase of prepaid instruments issued by the Reserve Bank of India under Section 18 in the Payment and Settlement Systems Act, 2007
Amount of cash deposits aggregating to INR 10 lakhs or more in a financial year, in one or more accounts of a person excluding his current accounts and time deposits.
Amount of cash withdrawals or cash deposits aggregating to INR 50 lakhs or more in a financial year, from or in one or more current account
Time deposits aggregating to INR 10 lakhs or more in a financial year excluding renewed time deposits.
Credit card bills paid by cash aggregating to INR 1 lakh and more and INR 10 lakhs and more by any other mode of payment in a financial year
Purchase of bonds or debentures (excluding renewals) in a financial year aggregating to INR 10 lakhs or more.
Acquisition of shares in a financial year aggregating to INR 10 lakhs or more
Buyback of shares from any person (other than the shares bought in the open market) for value aggregating to INR 10 lakhs or more in a financial year
Receipt from the sale of foreign currency, issuance of traveller’s cheque or credit of foreign currency to foreign exchange card of an amount aggregating to INR 10 lakhs or more in a financial year.
Investment into mutual fund scheme aggregating to INR 10 lakhs or more in a financial year
Cash receipt exceeding INR 2 lakhs for sale of goods or supply of services
Purchase or sale of immovable property for an amount of INR 30 lakhs or more.

All these specified financial transactions reported in Form 26AS can be verified with your actual transactions while filing your income tax return. Form 26AS comes in handy and ready-made statements for reference to taxpayers to avoid mistakes.

Verify the details of Form 26AS with the TDS certificate

While preparing your income tax return, it is important to tally your tax details and income details with the details reported in Form 26AS in order to avoid any errors and omissions. If there is an error or mismatch, you can get it rectified in Form 26AS by bringing it to the notice of the deductor. This helps you in avoiding any enquiry from the tax department. You can get all the details verified and get it corrected in case of an error.

Basically, Form 26AS revised version is a comprehensive and ready reckoner to taxpayers which helps them e-file income tax returns quickly and correctly.