What should a taxpayer refer to filing his/her income tax return (ITR), Form 26AS or Annual Information Statement (AIS)? People are require to check Form 26AS before the introduction of AIS so that all the taxes deducted in a financial year are reflect in the records of the Income Tax department via Form 26AS, as per report.
What is Annual Information Statement (AIS)?
Annual Information Statement (AIS) is a detail summary of a taxpayer’s information which is given in Form 26AS.
In addition to the TDS/TCS details, AIS will also show interest, dividends, stock market transactions, mutual fund transactions and others.
What is Form 26AS?
Form 26AS is an annual consolidated credit statement, containing information on direct taxes that a person has already paid to the government.
Every taxpayer can access their Form 26AS via the Income Tax Department’s official website by using their Permanent Account Number or PAN.
Annual Information Statement (AIS) Vs Form 26AS
The Annual Information Statement (AIS) was launch by the income tax department in November 2021.
Annual Information Statement (AIS) is much more comprehensive than Form 26AS.
This is because it also contains details of the income from various sources (salary, interest income, dividends, capital gains) that is receive by the taxpayer during the financial year, as per report.
In a press release during the launch of AIS, the IT department had said :
“In case there is a variation between the TDS/TCS information or the details of tax paid as displayed in Form26AS on TRACES portal and the TDS/TCS information or the information relating to tax payment as displayed in AIS on Compliance Portal, the taxpayer may rely on the information displayed on TRACES portal for filing of ITR and other tax compliance purposes.”
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Which one should you prefer for filing your ITR, AIS or Form 26AS?
At the question arises with the assumption of errors in AIS being rectified by now, which document you should prefer to file ITR this year, Form 26AS or AIS?
An individual should refer to both the AIS and Form 26AS to file their income tax return.
The income tax department has said that Form 26AS will now reflect only TDS and TCS.
Any other tax deposited such as self-assessment tax, advance tax will now be reflect in the AIS.
So, both documents are important to file ITR.
As both AIS and Form 26AS are equally important and should be refer by the taxpayers while furnishing their income tax returns.
It is quite unlikely that the information in Form 26AS will differ from that of AIS as the source of such information is mostly the same i.e., Statement of Financial Transactions (SFT) and TDS returns furnish by the tax deductors and others.
So, it has observe that AIS, at times, reflects duplicate information for certain details such as TDS from salary, mutual fund dividends and others.
What happens when there are Errors in both AIS and Form 26AS?
There are possibilities that there could be errors in both, AIS and Form 26AS.
The taxpayer should always maintain relevant documentation (bank statement/passbook, Demat statements, transaction agreements such as Purchase/ Sale deeds and others) for transactions enter by him during the relevant financial year.
So, if the taxpayer has sufficient documentation for the financial transaction mention in the AIS, you can rely on the same and accordingly provide feedback for correction in the AIS.
And in case of any errors in Form 26AS, the taxpayer may bring the same to the notice of the tax deductor and require the TDS return to be revise to rectify the error.
If the tax deductor refuses to or is unable to correct the mistakes, then you must keep relevant documents handy if the income tax department asks for proof.
