Demonenization - Cash transactions above 2 lakhs during the window-period must be shown in the IT Return

All cash payments of over Rs 2 lakh for paying loans and credit card bills during the 50-day period after the note ban will have to be disclosed in the new one-page Income Tax return (ITR) form. The new ITR forms for filing of returns for the Assessment Year 2017-18 (financial year (FY) 2016-17) had been recently notified by the IT Department wherein a new column have been provided for declaration for any deposit of over Rs 2 lakh in bank accounts made during November 9 and December 30, 2016, after the old Rs 500 and Rs 1,000 notes were demonetised. While all credit cards are linked to permanent account number (PAN) of the holder, almost all loans by scheduled banks are also provided on furnishing of PAN. The tax department will collate the data it has of cash payments made in excess of Rs 2 lakh with the returns filed. Post-demonetisation, the government had provided a 50-day window beginning November 9, 2016, to deposit the junked notes in bank accounts. For those with unaccounted cash, it gave them one last opportunity to come clean by depositing 50 per cent of it as tax and parking another 25 per cent in a zero- interest bearing deposit for four years. Revenue Secretary Hasmukh Adhia had last week told PTI that the new column of cash deposits made during November 9, 2016, and December 30, 2016, was a one-time feature in the ITR and would not be there in the ITR from next year onwards. The ITR, he had said, would evolve or change every year depending on the need. While coming out with new ITRs, the Central Board of Direct Taxes (CBDT) had also rationalised them and cut down the number of forms to seven from earlier nine. While all taxpayers will have to now mandatorily link Aadhaar with their PAN cards, ITR1 (Sahaj) form has been shortened from 7 page to 1 page to enable filing of returns by people with income up to Rs 50 lakh by July 31.

Read more at: http://www.taxscan.in/demonenization-cash-transactions-2-lakhs-window-period-must-shown-return/6609/