Why You Need To Verify Form 26AS Before You File Tax Returns?

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Why You Need To Verify Form 26AS Before You File Tax Returns?
Form 26AS i.e. the income tax department's tax credit statement details income tax paid either directly by you or on your behalf by your employer or bank as TDS on your deposits to the government. All in all form 26AS of a taxpayer includes tax deducted at source (TDS); tax collected at source (TCS); regular assessment tax, self-assessment tax and advance tax deposited at the bank; income tax refund received in a financial year; and high-value transaction in different financial securities such as shares, mutual funds, bonds etc.

The statement that can now be viewed by taxpayers either online or through net banking facility or by registering themselves on TRACES or TDS Reconciliation Analysis and Correction Enabling System i.e. the department's central processing cell needs to be reviewed at least once in a year. Know how Form 26AS can be viewed online and through net banking.

The verification of Form 26AS should be exercised in a much similar way like you get your bank account passbook updated from time to time or tally bank transactions with the help of bank account statement. The process should be completed before filing income tax return and the same holds importance due to the following reasons:

1. Form 26AS is an evidence that all of the income tax either deducted or collected from you has been deposited in the government account.

2. The form also serves as a proof that the TDS or TCS return has been filed by the deductor or collector on your behalf on time.

3. The statement also confirms whether or not the bank where you had deposited tax either as self- assessment tax or advance tax has correctly provided tax payment details to the authorities.

For the purpose of tallying, one can compare Form 16 that shows the amount of TDS deducted from salary or Form 16A for other tax deductions at source with Form 26AS to ensure that the deducted tax amount is indeed credited with the Income Tax dept.

Any kind of discrepancy in the tax credit statement, which can be either due to mention of the wrong PAN or non-submission of the tax amount by the deductor with the authorities, can be taken to the respective company or bank for rectification.

GoodReturns.in

Story first published: Thursday, April 17, 2014, 15:21 [IST]
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