Form 26AS Decoded: Here's How It Plays A Vital Role In Streamlining ITR Filing

Chai22

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posted on 1 year ago — updated on 1 second ago

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Acting as consolidated tax credit system, Form 26AS plays an important role in all the tax payments made on your behalf by your employer or clients.

Form 26AS is something you should be aware of if you are a person or a business submitting tax returns. Form 26AS, which serves as a unified tax credit system, is essential in all tax payments made on your behalf by your company or clients. It contains important information regarding Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) from various income sources such as banks and employers.

What is the significance of Form 26AS, and why should you pay attention to it before completing your income tax returns?

Let us dissect it and grasp its significance:

Form 26AS is like an annual statement provided to taxpayers by the Income Tax Department. It’s a summary of your tax information, including how much tax you have paid and any deductions you’ve made. Consider it a full record of all taxes paid against your Permanent Account Number (PAN).

Also Read: ITR Filing Update: Why You Must NOT Delay Filing Your ITR? Check Latest Update Here

One key reason to check your Form 26AS is to make sure it aligns with your income tax return (ITR). If there are any differences in the income or TDS figures between Form 26AS and your tax return, the income tax department may send you a tax notice asking for an explanation. The department relies on Form 26AS to analyze and verify your tax information, so any discrepancies can lead to unwanted attention.

To avoid such notices, it’s important for you to ensure that the entries in your Form 26AS are accurate and belong to you. If you notice any mistakes or mismatches, you should correct them before filing your ITR.

Apart from reconciling your tax details, Form 26AS serves another essential purpose. Certain transactions, like cash deposits above a specified threshold or buying a house, are required to be reported directly to the Income Tax Department by banks and financial institutions. These transactions appear in your Form 26AS under the Annual Information Return (AIR) section, but only if they exceed the specified limit.

To download Form 26AS from the TRACES website, follow these simple steps:

Start by visiting the e-filing website.

Enter your user ID, which may either be your PAN or your Aadhaar number.

Note: An error notice will be displayed if the user ID you submitted is incorrect. Give a valid user ID.

Enter your password.

The main screen will appear once you’ve logged in. Navigate to the ‘e-file’ section, select ‘Income Tax Returns,’ and then ‘View Form 26AS’ from the menu that appears.