Now taxpayers will have to inform the income tax department about the earnings from the stock market. The Finance Minister had given this information in the budget speech 2021. Hiding any such information from the tax department may also result in a hefty penalty.
For this, more and more people file income tax returns, for this, Finance Minister Nirmala Sitharaman has provided many strict rules related to ITR. This time the government has made preparations to crack down on those who do not file ITR to save TDS. If you do this too, be careful. In order to motivate taxpayers to pay taxes, it has been announced to add section 206AB in the Income Tax Act 1961. Under this, double TDS will be deducted from those who do not file income tax returns. According to the new rules, people who have not filed income tax returns will also be taxed more at the tax collection at source ie TCS. These rates will be 10-20 per cent, which was usually 5-10 per cent. Sections 206AB and 206CCA have been added to the Income Tax Act to increase the scope of TDS and TCS.
If you fall in the salaried class and make money from stock market trading, then you should read this news. Actually, the tax department will also keep an eye on the dividend income of such people. Till now, such people did not give information about the dividend income to avoid getting caught in many kinds of complications. Calculating capital gains on such earnings and filling separate and complicated tax forms for this was not a matter of the bus for everyone. But the tax department has solved this problem.
Taxpayers did not tell about such earnings to the tax department. The tax department was only able to know about the salary income, interest on bank FDs and earnings from other sources. Information about such transactions was given in Form 26AS.
The tax department will get complete information
But from 1 April 2021, the Income Tax Department will also get to know about stock trading, mutual fund transactions, dividend income, post office deposits and deposits kept in non-banking financial institutions. Now it has to be told in Form 26AS of the new format. The tax department will get direct information from the broker, asset management companies and post office about the profits from such earnings.
The finance minister announced in the budget
Till now, in the income tax return form, taxpayers had to give information about their name, PAN number, address, bank details, tax payment and TDS etc. While presenting the budget for the financial year 2021-22, Finance Minister Nirmala Sitharaman had said that the information listed in the income tax forms will already fill the information on capital gains, dividend income and interest from the bank and post office. This will make the process of filing returns for people easier.
CBDT has issued a notification
To implement this proposal of the Finance Minister, the Central Board of Direct Taxes i.e. CBDT has also issued a notification on March 12. The CBDT has stated in this notification that certain categories of people will have to give information about their financial transactions under section 285BA of the Income Tax Act, 1961. This includes information on capital gains, dividend income and interest income from listed securities and mutual funds. People coming in this category will have to give such information. The tax department will get this information from stock exchanges, depositories, clearing corporations, IPO registrars, share transfer agents,dividend paying companies, banking companies and cooperative banks such as BSE and NSE.
Penalty may be incurred
In such a situation, after extensive coverage of the annual information system from April 1, 2021, taxpayers will have to tell about the earnings from all these sources. This information will already be filled in their ITR. If any taxpayers hide such information from the Income Tax Department, then they will also have to be ready to pay a hefty penalty.