The government has made the filling of Statement of Financial Transaction (S.F.T.) mandatory for persons liable for Audit under section 44AB of the Income Tax Act, 1961. The Last date for filling SFT is 31 May, 2017.
Here we are answering some Frequently Asked Questions regarding filling of Statement of Financial Transactions (SFT) for persons liable for Audit u/s 44AB of the Income Tax Act, 1961:-
1. WHO WILL BE REQUIRED TO FILE SFT?
All business establishments and professionals who are liable for Audit u/s 44AB of the Income Tax Act, 1961 are liable to file the Statement of Financial Transaction (SFT) for the F. Y. 2016-17.
2. WHICH TRANSACTION IS REQUIRED TO BE REPORTED IN SFT?
Receipt of cash payment exceeding Rs 2 lakh by any person for sale of goods/services (other than those specified above).
(Note : In case if any person is covered under any other “Class of Persons” who are liable to file SFT specified under sub rule 2 of Rule 114E, then the reporting requirements of that category shall apply on him. For nature and value of Re-portable transaction please visit http://incometaxindia.gov.in/Rules/Income-Tax%20Rules/103120000000007545.htm)
3. WHAT IS THE DUE DATE FOR FILLING OF SFT?
SFT has to be filled before 31-05-2017.
4. IS SFT REQUIRED TO BE FILLED FOR NIL TRANSACTION?
If there is a NIL reportable transaction then the assessee is required to file only the ‘SFT Preliminary Response’ on the Income Tax Portal.
Steps to File SFT Preliminary Response:-
Step 1 : Login to the income tax accounts
Step 2 : Generate your ITDREIN
a) Click ‘My Account’
b) Click ‘Manage ITDREIN’
c) Click Generate new ITDREIN
i) Select Form Type
ii) Select Reporting Entity Category
Step 3 : Click on Compliance
Step 4 : Click on SFT Preliminary Response
Step 5 : Please select the appropriate option under the reportable transaction:-
a) In case if there are some reportable transaction for the year which have been/ will be filled under Form 61A – Select YES
b) In case if the Transaction Type is Applicable, but there are no reportable transaction during the year – Select NO
c) In case if Transaction type is not Applicable – Select NOT APPLICABLE
Step 6 : Submit the SFT Preliminary Response
5. ARE ALL TRANSACTIONS DURING THE YEAR REQUIRED TO BE AGGREGATED FOR REPORTING PURPOSE?
The norms of aggregation contained in sub-rule 3 of Rule 114E have been amended vide CBDT’s Notification No. 91/2016 dated 6th October, 2016; clearly indicating that the said transactions did not require aggregation and the reporting requirement under SFT for this purpose is on receipt of cash payment exceeding Rupees Two Lakh for sale of goods or services per transaction.
6. WHAT IS THE PENALTY FOR DELAY / NON FILLING OF SFT?
Penalty u/s 271 FA & 271 FAA of the Income Tax Act, 1961 are as below:-
a) If a Notice is not received from the ITD – Rs. 100/- per day of delay
b) If notice has been issued by the ITD – Rs. 500/- per day (beginning from the day immediately following the day on which the time specified in such notice for furnishing the return expires)
c) For providing inaccurate information in the SFT Statement – Rs. 50,000/-
7. HOW TO FILE THE SFT REPORT IN FORM 61A?
Step 1 : Download the E-Filling utility of the Form 61A from the Income Tax E-Filling Portal [Link : https://incometaxindiaefiling.gov.in]
Step 2 : Prepare, Generate and Validate the SFT File
Step 3 : Upload the SFT File on the Income Tax E-Filling Portal
[For detail guideline for filling of the Form 61 & 61A please download the User Manual from the Link : https://incometaxindiaefiling.gov.in/eFiling/Portal/StaticPDF/ITDREIN_Registration_and_Upload_of_Forms_61_61A.pdf?0.7017536062311123]