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  7. Form 61A of Income Tax - Statement of Financial Transactions (SFT)

What is Form 61A? - Statement of Specified Financial Transactions (SFT) Form 61A

Updated on: 08 Jul, 2024 03:27 PM

To monitor high-value transactions made by taxpayers, the income tax department introduced a new concept of furnishing a Statement of Financial Transactions or reportable accounts. Section 285BA of the Income-Tax Act requires specified reporting persons to furnish this statement. Rule 114E of the Income Tax Rules 1962 specifies that this statement must be furnished in Form 61A of Income Tax Act.

Form 61A is the statement of specified financial transactions(SFT) required to be furnished under Section 285BA of the income tax by certain specified persons. Let us read more.

Contents

What is Form 61A of Income Tax Act?

Form 61A is the form in which the details of specified financial transactions are to be filed under section 285BA of the Income Tax Act, 1961, read with Rule 114E of the Income Tax Rules, 1962.

Form 61A is used to report all the Specified Financial Transactions to the Income Tax Department. This helps the tax department to identify high-value transactions and compare them with the income reported by such persons(that are executing such high-value transactions) in their income tax returns. The tax department sends notices to such persons if there is a mismatch. Thus, it helps in avoiding tax evasion.

In simple words, Form 61A acts as a bridge between the Income Tax Department and reporting entities, providing transparency and enabling the department to identify discrepancies between reported income and high-value transactions.

Who must file Form 61A?

The following persons/entities are required to file SFT when they enter into specified transactions as discussed below -

  • Person liable for audit u/s 44AB of the Income Tax Act
  • Banking Company
  • Co-operative Bank
  • Post Master General of Post Office
  • Nidhi Company referred u/s 406 of the Companies Act 2013
  • NBFC(Non-banking Financial Company)
  • Company or Institution issuing bonds or debentures
  • Company issuing shares
  • Listed Company (listed on a recognized stock exchange) purchasing its own securities u/s 68 of Companies Act 2013
  • Trustee of a Mutual Fund or such other person managing the affairs of the MF
  • Authorized Person under FEMA(Dealer, Money Changer, Off-shore Banking Unit, or any other person defined in FEMA, 1999)
  • Inspector-General/Registrar/ Sub-Registrar appointed under Registration Act, 1908
  • A banking company, a bank, or any other company or institution issuing a credit card
File ITR

What are the Specified Financial Transactions to be reported in Form 61A?

All Transactions incurred by the “Specified Person” of the nature/value specified in the Table below are called the specified financial transactions. All these need to be reported when filing Form 61A.

Specified Person Type of transaction Amount Value(Rs.)
Person liable for audit u/s 44AB of the Income Tax Act Sale by any person of goods or services of any nature Receipt of cash exceeding Rs. 2 lakhs
Banking Company or Co-operative Bank Payment made in cash for the purchase of :
  • - Bank Draft’s
  • - Pay orders(PO), --Banker’s Cheque
  • - Pre-paid instrument issued by RBI
 Aggregating Rs. 10 lakhs or more in a financial year.
--> Cash deposit or cash withdrawals(including bearer’s cheque) Aggregating Rs. 50 lakhs or more in a financial year, from one or more current accounts of a person.
Banking Company or Co-operative Bank or Post Master General Cash Deposit(other than current account and time deposit) of a person Aggregating to Rs.10 lakh or more in one or more accounts
Banking Company or Co-operative Bank or Post Master General or
Nidhi company or
NBFC 		One or more time deposits(other than one made through renewal of another time deposit) of a person Aggregating to Rs.10 lakh or more in a financial year
Company or Institution issuing bonds or debentures Receipt from any person for acquiring debenture/bonds issued by company/institution(other than the amount received for renewal of the bond/debenture issued) Amount aggregating Rs. 10 lakhs or more in a financial year
Company issuing shares Receipt from any person acquiring shares (including share application money) issued by a company Amount aggregating Rs. 10 lakhs or more in a financial year
Listed Company (listed on a recognized stock exchange) purchasing its own securities u/s 68 of Companies Act 2013 Buyback of shares from any person (other than shares bought in open market) Amount or value aggregating to Rs. 10 Lakhs or more in a financial year
Trustee of a Mutual Fund or such other person managing the affairs of the MF The amount received for acquiring units of one or more schemes of a mutual fund(other than the amount received on account of transfer from one scheme to another) Receipt from any person of an amount aggregating to Rs. 10 lakhs or more in a financial year
Authorized Person under FEMA(Dealer, Money Changer, Off-shore Banking Unit or any other person defined in FEMA, 1999) Receipt from any person from the sale of foreign currency, including any credit of such currency to a foreign exchange card or expense in such currency through credit or debit card or through the issue of travelers cheque or draft or any other instrument Aggregate amount to 10 Lakh or more in a financial year
Inspector-General/Registrar/ Sub-Registrar appointed under Registration Act, 1908 Purchase or sale by a person of immovable property Amount of Rs. 30 lakh or more or valued by stamp duty valuation authority referred to in section 50C at Rs. 30 lakh or more
Banking company, a cooperative bank or any other company or institution issuing a credit card Payment made by any person against bills raised in respect of one or more credit cards issued to that person Aggregate amount of
  • Rs. 1 lakh or more in cash
Or
  • Rs. 10 lakh or more by any other mode
Banking Company or Co-operative Bank or Postmaster General Cash deposits during 09th November, 2016 to 30th December, 2016 Amount aggregating to
  1. Rs. 12.50 lakh or more in one or more current accounts of a person
  2. Rs. 2.50 lakh or more in one or more accounts (other than a current account) of a person
Banking Company or Co-operative Bank or Postmaster General Cash deposits during 01st April, 2016 to 09th November, 2016 With respect to accounts that are reportable at the just above point.

Due Date to File Form 61A

The statement of the financial transaction shall be furnished on or before the 31st of May immediately following the financial year in which the transaction is registered or recorded by the notified specified person.

  • A penalty of Rs 500 under Section 271FA shall be levied for non-filing Form 61A within the due date. The authorities would issue a notice to such an assessee, demanding the assessee to submit the form within 30 days from the issuance of such notice.
  • The last date to file an Income Tax Return (ITR) for FY 2023-24 (AY 2024-25) without a late fee is 31st July 2024.

How to register for SFT filing?

The reporting person/entity must register with the Income Tax Department and generate an ITDREIN(Income Tax Department Reporting Entity Identification Number). Once it is generated, there is no option to deactivate it.

  • Step 1: Log in to the e-Filing website (https://incometaxindiaefiling.gov.in/) with the login ID used for the purpose of filing the Income Tax Return of the reporting person/entity.
  • Step 2: Click the “My Account” tab and select the “Reporting Portal” link to access the ‘Reporting Portal’ for first-time registration.
  • Step 3: Now enter the following details - Form Type, Category, Address of reporting person/entity, and Details of Principal Officer.
  • Step 4: After successful submission, the ITDREIN is generated. The Principal officer will receive an e-mail confirmation on the registered e-mail address and an SMS on the registered mobile number.

Note: Registering for SFT filing only creates your account. You'll still need to prepare the SFT data (transactions exceeding the threshold) and upload it using the Reporting Portal during the designated filing period.

How to file Form 61A online?

  • For filing Form 61A first the prescribed schema, Report Generation and Validation Utility, and Generic Submission Utility need to be downloaded from the reporting portal under the “Resources” tab.
  • Then, general and transaction-specific SFTs will be generated in the specific format as per the preparation guidelines.
  • Now, upload the prepared and digitally signed SFT at the reporting portal after login using the (PAN and password) of the designated director.

Upon successful filing, an “Acknowledgment Number” will be sent to the registered email id.

What is the penalty for not filing Form 61A?

If a person required to furnish a statement of financial transaction under section 285BA fails to furnish such statement :

  1. Within the time prescribed, such person shall be liable to pay the penalty u/s 271FA of Rs. 500 for every day during which such failure continues.
  2. After issuing of notice to file a statement under section 285BA - Such person shall be liable to a penalty u/s 271FA of Rs. 1000 per day starting from the day immediately following the day on which the time specified in the notice for furnishing statement expires till the day failure continues.
    If a person receives a notice to file a statement, they are required to submit the statement within 30 days from the date the notice is served.

What will happen if a defective Form 61 is filed?

The Income Tax Department will typically intimate you about the defect in your Form 61A. They will provide a window of 30 days from the date of intimation to rectify the errors and resubmit the information.

If a specified person referred under section 285BA(1) files inaccurate details in form 61A, then a penalty of Rs.50,000 shall be imposed u/s 271FAA of the Income Tax Act.

If you have received a notice from the Income Tax Department, our online CAs can help you respond to ITD Notices. If you need assistance with e-filing your Income Tax Return, book an eCA now!

Frequently Asked Questions

Q- What is Rule 114E?

Rule 114E of the Income Tax Rules, 1962 specifies Form 61A, the form for filing the statement of specified financial transaction that is required to be furnished u/s 285BA(1).

Q- Is it mandatory to file Form 61A?

Yes, it is mandatory to file for the specified entities with respect to specified financial transactions.

Q- What is ITDREIN?

ITDREIN (Income Tax Department Reporting Entity Identification Number)is the Unique ID issued by ITD which will be communicated by ITD after the registration of the reporting entity with ITD. The ITDREIN is a 16-character identification number in the format XXXXXXXXXX.YZNNN where :

=
ITDREIN Component Description
XXXXXXXXXX PAN or TAN of the reporting entity
Y Code of Form Code
Z Code of Reporting Entity Category for the Form Code
NNN Code of Sequence Number

Q- What are different parts of Form 61A

There are different parts in Form 61A, which are mentioned below:

  • Part A (Statement Details): In this part of the form, the following details are mentioned- Reporting Entity details, Statement details, and Principal office details.
  • Part B (Report details for person based reporting): In this section, the following details are mentioned - Report number, Person details, Financial transaction summary and Financial transaction details.
  • Part C (Report details for Bank/ Post Office Account): This part of the form includes the report number, account details, account summary, and personal details.
  • Part D (Report details for immovable property transactions based reporting). In this part of the form Report number, transaction details and person details are included.
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CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.