Income Tax: Why is trusting AIS blindly not a great idea? This is what taxpayers can do

The income tax return (ITR) filing deadline on September 15 is drawing closer. Taxpayers are supposed to access necessary information through a multitude of documents, including Form-16, 26AS and Annual Information Statement (AIS).

While 26AS includes information related to TDS (tax deducted at source) and TCS (tax collected at source), all other details pertaining to the taxpayer are reflected in the Annual Information Statement.

However, taxpayers are recommended to examine the information given on AIS carefully and cross-verify it with other related documents.

What is AIS?

Annual Information Statement provides complete information about a taxpayer for a particular financial year. It entails information about taxpayers’ incomes, financial transactions, and tax details, among others.

AIS can be accessed by logging into income tax e-filing account or through the mobile app “AIS for Taxpayer”.

Can there be errors in AIS?

There could be occasions where the information recorded in AIS is different from the actual figure.

The Income Tax portal (incometaxindia.gov.in) states that in case the information given in AIS is wrong, duplicated, or pertains to someone else, taxpayers can share their feedback on it.

Pratibha Goyal, a Delhi-based chartered accountant, highlights a few cases that she encountered while filing returns for her clients. There was a case, she told Livemint, wherein a mother-son duo sold a joint property for less than ₹50 lakh. 

“The buyer in that case had reported the transaction as a sale from the son only. So, TDS in the mother’s AIS was not shown. As a result, this had to be taken note of while filing the income tax return,” she said.

In another case, Goyal mentions, a sale of securities was written twice.

What is the way out?

One of the most feasible ways to rectify the mistake is to cross-verify information with that on a related document.

Goyal recommends that taxpayers reconcile the information with that on the related document. For instance, if it is related to interest received from a bank, then instead of relying on the AIS alone, the taxpayer can cross-check the information against the certificate issued by the bank.

A taxpayer can access details related to AIS and submit their response (if needed) by logging into their income-tax e-filing account, according to the information available on the I-T portal.

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