GST Department Use of 26AS, AIS & ITR for Income Verification
The Goods and Services Tax (GST) department is intensifying its efforts to monitor taxpayers' income by cross-referencing data from Form 26AS, the Annual Information Statement (AIS), and Income Tax Returns (ITRs). This coordinated approach with the Income Tax Department aims to detect discrepancies and curb tax evasion.
Key Objectives:
- Identify Mismatches: By comparing the declared turnover in GST filings with the income reported in ITRs, authorities can pinpoint inconsistencies.
Notable Incidents:
1. Digital Payment Monitoring:
Case: A street vendor in Tamil Nadu received a GST notice due to substantial digital transactions.
Insight: The GST department is scrutinizing digital payments made through platforms like UPI, PhonePe, Paytm, and GPay to assess potential GST liabilities.
2. TDS Data Cross-Verification:
Case: A taxpayer faced a GST notice because of discrepancies between Form 26AS and GST portal declarations.
Insight: The department is matching Tax Deducted at Source (TDS) data from Form 26AS with GST returns to uncover undeclared income.
3. Income Discrepancies:
Case: An individual was issued a GST notice based on income variations observed in Form 26AS.
Insight: Authorities are leveraging Form 26AS data to compare with GST turnover, ensuring all taxable supplies are accurately reported.
Recommendations for Taxpayers:
- Consistent Reporting: Ensure that the turnover reported in your ITR aligns with your GST registration status. For instance, if you're not registered under GST, avoid reporting a turnover exceeding ₹20 lakh in your ITR.
- Limit Digital Transactions: Unregistered GST individuals should consider limiting UPI payments to ₹40 lakh for goods and ₹20 lakh for services to stay below the GST threshold.
- Accurate Turnover Declaration: Avoid inflating turnover figures in ITRs for purposes like securing loans, as this can trigger scrutiny.
Understanding Form 26AS and AIS:
Form 26AS: This statement provides details of any amount deducted as TDS or TCS from various income sources of a taxpayer. (Source)
Annual Information Statement (AIS): An extension of Form 26AS, AIS offers a comprehensive view of information for a taxpayer, including savings account interest, dividends, rent received, purchase and sale transactions of securities/immovable properties, foreign remittances, interest on deposits, and GST turnover. (Source)
Conclusion:
The integration of data from Form 26AS, AIS, and ITRs signifies a robust mechanism by the GST department to promote transparency and compliance. Taxpayers are advised to maintain consistency across all financial declarations to avoid potential legal implications.
