It is a statement of ‘Specified Financial Transactions’ or SFT transaction that taxpayers are required to submit to the government for a given financial period. Form 61A is generated under Section 285 BA of the ITA and was earlier known as Annual Information Return or AIR.
As per Income Tax Rules 1962, Rule 144E states that details like the type and value of transactions must be reported in Form 61A.
Taxpayers must submit Form 61A on the 31st of May each year immediately upon the completion of the financial year whose details are recorded in it. It helps to maintain a proper record of filing taxes and claiming returns, if applicable.
Form 61A of Income Tax
Form 61A reports specified financial transactions under Section 285BA of the Income Tax Act, 1961, and Rule 114E of the Income Tax Rules, 1962. This form is essential for reporting all specified financial transactions to the Income Tax Department. It enables the tax authorities to identify high-value transactions and compare them with the income reported by individuals in their income tax returns. If discrepancies are found, the tax department issues notices to the concerned individuals, helping to prevent tax evasion.
What is Specified Financial Transactions
The SFTs include-
- Works contract
- Accepting any deposit/taking any loan
- Any investment made/expenditure incurred
- Sale/purchase/exchange of goods, property, rights, interest in any certain property
Components of Form 61A
Form 61A income tax comprises two parts, namely – Part A, which includes statement level information and the other part (Part B/C/D) is a report statement, i.e. Form 61B.
Generally,
- Part B is person-based reporting
- Part C is account-based reporting
- Part D is immovable property-based reporting
The most significant components of this Form include –
- Full name
- Folio number
- Address
- PAN
- Year of Transactions/Financial Year
- Details of transactions
- Number and Value of Specified Financial Transactions
Who Has to File Form 61A?
The following are some of such entities that are required to file Form 61 Income Tax –
- NBFCs
- Co-operative banks
- Nidhi (Referred in Companies Act 2013, under Section 406)
- Post-Master General
- Credit card issuers
- Bonds or debentures issuing companies or institutions
- Companies listed on recognised stock exchanges
- Trustees of mutual funds
- Off-shore banking units, money changer, authorized dealer and others defined in FEMA, 1999.
- Sub-registrars or Inspector Generals who were appointed under Registration Act, 1908
FAQs
Which Transactions are Reported in Form 61A?
Entities Responsible for Submitting Form 61A | Type of Transaction | Limit of Transaction |
Banking institutions, co-operative banks and post offices | Deposits in either one or more accounts. | Over Rs.10 lakh |
Banking institutions and co-operative banking institutions | Withdrawals or deposits from a current account. | Over Rs.50 lakh |
Cash payouts for demand drafts and purchase orders. | Over Rs.10 lakh (annually) | |
Cash payouts for purchasing prepaid RBI investment instruments like RBI bonds. | Over Rs.10 lakh | |
Companies issuing shares | Receipts from individuals to acquire shares and includes share application money received. | Over Rs.10 lakh (in a year) |
Companies or institutions issuing bonds and debentures | Receipts from individuals to acquire bonds or debentures | Over Rs.10 lakh (in a year) |
Listed Companies | Share buy-backs | Over Rs.10 lakh |
Banking Companies, Postmaster Generals of Post Offices and Co-operative banks | Total online payment of a credit card bill that is issued in a year | Over Rs.10 lakh |
Total cash paid in a year against the credit card bill that is issued in a year. | Over Rs.1 lakh | |
Dealers of foreign exchange | Receipts for sale of foreign currencies or expenses incurred in the said currencies via credit card/debit card or through the issuance of travellers’ cheque, draft or other financial instruments. | Over Rs.10 lakh |
Managers or Trustees of mutual funds | Receipts from individuals acquiring mutual fund units. | Over Rs.10 lakh |
Inspector Generals or Sub Registrar appointed under Registration Act of 1908 | Sale or purchase of immovable properties. | Over Rs.30 lakh |
Individuals who are liable for audit under Section 44AB of ITA. | Cash receipts for the sale of goods or rendering services. | Rs.2 lakh |
What is the Penalty for Default or Delay?
A 30-day warning is sent to taxpayers who have not filed and submitted this document. Taxpayers are required to file for the same within the designated period. It must be noted that if they still do not file Form 61A, they will have to pay Rs. 500 per day of delay.
Additionally, a Prescribed Financial Institution is liable to pay a penalty of Rs. 50000 if it provides inaccurate data in Form 61A. Such institutions have a 10-day window to reach out to the concerned authority regarding the inaccuracy of details shared and to get them rectified.