All cash payments of over Rs 2 lakh for paying loans and credit card bills during the 50-day period post demonetisation will have to be disclosed in the new one-page Income Tax return form. The tax department a few days back notified new Income Tax Return (ITR) forms for filing of returns for the Assessment Year 2017-18 (financial year 2016-17).
Besides providing for declaring income, exemption claimed and tax paid, the forms have a new column providing for declaration for any deposit of over Rs 2 lakh in bank accounts made during November 9 and December 30, 2016 after the old 500 and 1,000 rupee notes were demonetised.
This column is also to be used for declaring cash payments in excess of Rs 2 lakh for repayment of any loan or settlement of credit card bills during this 50-day period, a senior official told PTI. "The column is an attempt to match the cash deposits made post demonetisation with the annual income," he said.
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. "We want to see if the income profile matches with the cash payments made," he said.
The move comes amid concerns of unaccounted cash or black money being used to settle bills after credit cards were used to make heavy purchases. It could also be that black money could have been used to repay loans.
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. The changes made in ITR are an attempt to catch tax evaders, the official said.
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.