Form 61A is a statement of Specified Financial Transactions that needs to be submitted by a notified taxpayer for the applicable financial year. Form 61A is generated under Section 285 BA of Income Tax Act, 1961 read with Rule 114E of Income Tax rules, 1962. Additionally the nature and value of the transactions that need to be mentioned in the specified financial transactions statement are governed by Rule 114E enclosed in Annexure A. Due date for submitting Form 61A for the previous financial year is before 31st May of the applicable assessment year. Thus, you need to submit Form 61A on 31st May 2020 for the Specified Financial Transactions carried out in FY 2019-20.
Key Sections of Form 61A
The following are the key sections and details mentioned on a typical Form 61A:
- Full Name
- Permanent Account Number (PAN)
- Folio Number
- Address
- Financial Year in which the transactions carried out are being reported
- Number of Specified Financial Transactions
- Total Value of Specified Financial Transactions carries out in the financial year
- Details of the transactions: date of transactions, name of transacting party, PAN of transacting party, full address, mode of transaction, transaction amount, transaction code, etc.
Before we move further, it is important for you to know the transactions that must be declared and reported in Form 61A.
What are Specified Financial Transactions to be reported in Form 61A?
Specified Financial Transactions to be reported using Form 61A are governed by Annexure A of Rule 114E of Income Tax Rules, 1962. Here are the individuals/entitiesresponsible for furnishing Form 61A for key types of specified financial transactions and applicable transaction limits:
| Individuals/Entities Responsible for Furnishing Form 61A | Type of Transaction | Transaction Limit |
| Banking Companies and Co-operative Banks | Cash payment for purchase of POs (Purchase orders) / DDs (Demand drafts) | More than Rs. 10 lakhs annually |
| Cash payment for purchasing any prepaid RBI instruments like RBI bonds, etc. | More than Rs. 10 lakhs | |
| Deposits or withdrawals from a current account of an account holder | More than Rs. 50 lakhs | |
| Banking Companies, Co-operative Banks and Post Offices | Deposits in one or more accounts of an account holder | More than Rs. 10 lakhs |
| Banking Company, Co-operative Bank, Post Master General of Post Office | Aggregate cash payment in a year against any credit card bill which is issued to a customer in a year | More than Rs. 1 lakhs |
| Aggregate Online payment of any credit card bill which is issued to a customer in a year | More than Rs. 10 lakhs | |
| A company or an institution issuing debentures or bonds | Receipt from an individual for acquiring such debentures/bonds | More than Rs. 10 lakhs in a year |
| A company issuing shares | Receipt from an individual for acquiring such shares. This includes share application money received. | More than Rs. 10 lakhs in a year |
| Listed companies | Share buy-back from a person | More than Rs. 10 lakhs |
| Manager/Trustee of a Mutual Fund | Receipt from an individual acquiring the units of such Mutual Fund | More than Rs. 10 lakhs |
| A Dealer of Foreign Exchange | Receipt from a person for sale of foreign currency or expenses incurred in such foreign currency via a debit/credit card or via issue of draft or traveller’s cheque or any other financial instrument | More than Rs. 10 lakhs annually |
| Inspector-General/Sub-Registrar appointed under the Registration Act, 1908 | Sale/ Purchase by a person of an immovable property | More than Rs. 30 lakhs |
| Persons liable for audit under Section 44AB of the Income Tax Act | Cash receipt for sale of goods or rendering of services (other than the ones specified above) | More than Rs. 2 lakhs |
What is the utility of Form 61A?
Form 61A lists all the Specified Financial Transactions carried out in a financial year. This helps the Income Tax department identify high-value transactions and curb possible tax evasions. Additionally, the availability of these documents would help the individuals/organisations track high value specified financial transactions for their own records.
Penalties for not submitting Form 61A
If an individual carrying out a specified financial transaction fails to submit Form 61A then the authorities issue a notice to the individual demanding the submission of the form within 30 days from the date of issuance of the notice. If the individual does not answer to the notice and fails to submit Form 61A then a penalty of Rs. 500 per day of default is levied. This penalty is calculated from the date of expiry of the period stipulated in the notice.
Consequences of Filing Defective Form 61A
If the reporting entity or individual discovers any inaccuracy or discrepancy in the information provided in Form 61A then he shall get in touch with the concerned income tax authority within 10 days to make a correction without any penalties. If the income tax authorities find out that the information furnished in Form 61A is defective or incomplete in any way then they intimate the reporting entity or person. The reporting person or entity is given the opportunity to rectify the information within 30 days from the date of intimation.
The following are the penalties defined in the Income Tax Act for not furnishing a corrected Form 61A:
- Penalty of Rs. 50,000 is levied on reporting entities and individuals for providing inaccurate information deliberately.
- Penalty of Rs. 50,000 is levied on reporting entities and individuals who find out about the inaccuracy in data after submitting the statement but do not inform the concerned authorities and furnish correct information within 10 days.
- Penalty of Rs. 500 per day is levied from the expiry of the original due date till the due date mentioned in the notice for default because of furnishing incorrect information. Penalty of Rs. 1000 per day is levied beyond the due date specified in the notice.
The concerned tax authority may extend the date for rectification of details in the case of default. However, if the reporting entity or person fails to rectify the information even after receiving the notice, the statement in question (Form 61A) is treated as invalid.