E-platform set up to keep eye on customers' transactions

From bank deposits to credit card bill, the financial institutions are now keeping a close eye on customers' transactions. The financial institutions have been asked to report transactions above a certain threshold to the Income Tax department. For this, the Income Tax authorities have set up an e-platform through which banks can report all the transactions.

Banks have also to report cash deposits aggregating Rs 10 lakh or more in a financial year, in one or more accounts (other than a current account and fixed deposit) of a person. Moreover, cash payments of Rs 1 lakh or more for credit card bills have to be reported. The tax department also reiterated its November 2016 instruction asking banks to report all cash deposits of Rs 2.5 lakh or more made in one or more accounts of a person during November 9 to December 30, 2016.

For current accounts, banks have to report deposits of Rs 12.5 lakh or more during the period. After demonetisation of old 500 and 1,000 rupee notes, the government had allowed the junked currency notes to be deposited in bank accounts during a 50-day window ending December 30, 2016. Meanwhile, companies have also to report receipt from any person for amount aggregating to Rs 10 lakh or more in a financial year for acquiring bonds or debentures. A similar limit has been also set for reporting purchase of mutual funds units or buyback of shares.

Nevertheless, the purchase of foreign exchange, including travellers' cheques and a forex card aggregating to Rs 10 lakh will have to be reported to tax authorities. Property registrars will have to report to tax authorities purchase or sale by any person of immovable property for an amount of Rs 30 lakh or more.