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Statement of Financial TransactionsSTATEMENT OF FINANCIAL TRANSACTIONS(SFTs), replaced AIR. It’s applicable on Professionals & all assesses liable to Tax Audit also

1) Earlier the requirement of filing Annual Information Return(AIR) has now been completely replaced by Statement of  Financial Transactions (SFT).

2) The DUE DATE for filing first such SFT is 31.5.2017.

3) By May 31, business establishments, any person liable to tax audit u/s 44AB, various financial institutions & professionals, including doctors, lawyers and architects, will have to report a slew of high-value transactions such as cash deposit, credit card payments, share sale, property deals, debentures and mutual fund units among others.

4) Salaried individuals are not required to file the newly introduced statement of financial transactions (SFT).

5) Entities that will have to report are banks, professionals, fund houses, forex dealers, post office, nidhis, non-banking finance companies, property registrars, companies issuing bonds and debentures, and listed companies buying back shares from specific persons.

6) Under the modified rules, the earlier requirement of filing annual information return (AIR) has now been replaced by SFT.

7) The changes have created new classes of first time filers who have to file SFT of specified transactions for FY 2016-17.

8) The nature of transactions includes cash payment for purchase of demand drafts or pay orders of Rs 10 lakh or more in a year; cash payment of Rs 10 lakh or more for purchase of pre-paid RBI instruments, cash deposit or withdrawal of Rs 50 lakh or more from current account; one-time deposit of Rs 10 lakh or more with banks, nidhis, NBFCs and post offices; payment of Rs 1 lakh or more in cash and Rs 10 lakh or more by other mode against credit card bill issued to a person during the year; and property registrars for deals worth Rs 30 lakh or more.

9) SFTs have to be filed in separate form and not along with the regular Income tax returns.

10) As per the new requirements, apart from specific filers like banks which used to file similar AIR returns, SFT regulations would cover *any person who is liable to audit under Section 44AB* of the Income Tax Act, 1961. The particular section relates to audit of businesses and professions.

12) Form 61A , which consists of 4 parts,  where part 1 of the said form is compulsory for any taxpayers falling in preview of section 285BA of the Income tax Act.

13) Form 61A is available on income tax site can be reached from HELP button on home page.

14) It is a zip file , unzip and click on Export file, to fill in excel formal. After filing the form , validate the file. Xml will be generated. While uploading, import the file,again zip file will be created.

15) Point to remember is that even after file gets uploaded , it takes 24 hours to confirm successfully uploaded. So last hour rush should be avoided.

16) Any technical queries pertaining to Efiling 61A can be emailed to Mr. Kajla at:
Sft@incometax.gov.in

17) For instance, while reporting an entity will have to take into account all the accounts of the same nature maintained in respect of a person during a financial year; also, while attributing the entire value of the transactions to all the persons in cases where the account is maintained or transactions recorded in the name of more than one person.

18) Penalty on delay is Rs. 100 per day, if notice not received, else upto Rs 500/ day.

19) Filing of inaccurate information will attract penalty of Rs 50,000.

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5 thoughts on “Statement of Financial Transactions (SFTs)

  1. Surinder Singh says:

    whether 2 Lac amount is for one time bill or consolidated figure in a year.
    If my accounts audited & I have deposited a sum of Rs. 50 Lac in my current account & Rs. 15 Lac in Saving Account then who is required to file SFT whether Bank or myself

    1. Minesh Patel says:

      Rule 114E,requires any person who is liable for audit under section 44AB of the Income-tax Act, 1961 to report transaction of receipt of cash payment exceeding Rs. 2 lakh (per transaction) for sale of goods or services of any nature in the Financial Year 2016-17.

      Sir, if you deposited a sum of rs. 50 Lax in C/A or SB act you have to file SFT not bank.

  2. P.M. DAYAL BABU says:

    Dear Sir,

    Please clarify the following,

    I make the credit bill amount to Rs.230000/- I received cash Rs.40000/- by cash balance received by cheque Rs.190000/- now section 114E is applied.

    1. Sushant Sigh says:

      No Sir
      Section 114E is not applied to you.As your cash transaction does not cross limit of Rs. 2 laks.

  3. Srinivas says:

    Last date for filing of form – 61 for first half year is ?

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