The Central Board of Direct Taxes has notified the Format, Procedure and Guidelines for SFT for Interest Income under Section 285BA of the Income Tax Act, 1961 and Rule 114E that requires specified reporting persons to furnish SFT. Read the official notification below:
DGIT(S)/ADG(S)2/Reporting Portal/2021/180
Government of India
Ministry of Finance
Central Board of Direct Taxes
Directorate of Income Tax (Systems)
Notification No. 2 of 2021
New Delhi, 20 April, 2021
Format, Procedure and Guidelines for submission of Statement of Financial Transactions (SFT) for Interest income
Section 285BA of the Income Tax Act, 1961 and Rule 114E requires specified reporting persons to furnish statement of financial transaction (SFT).
2. For the purposes of prefilling the return of income, CBDT has issued Notification No. 16/2021 dated 12.03.2021 to include reporting of information relating to interest income. The new sub rule 5A of rule 114E specifies that the information shall be furnished in such form, at such frequency, and in such manner, as may be specified by the Director General of Income Tax (Systems), with the approval of the Board.
3. The guidelines for preparation and submission of Statement of Financial Transactions (SFT) information are enclosed in Annexure A and Annexure B respectively. The data structure and validation rules are enclosed in Annexure C and Annexure D respectively. Notification No. 3 of 2018 Dated 5.04.2018 may be referred for the procedure for registration.
4. Reporting entities are required to prepare the data file in prescribed format from their internal system. An excel based report preparation utility has also been provided to assist small reporting entities in preparing data file. The data files prepared by internal system/report preparation utility should be validated using Text File Validator/Submission Utility. After validation, the text file is required to be compressed, encrypted and signed using the Text File Submission Utility before uploading on the reporting portal (https://report.insight.gov.in/). Reporting entities, having large number of data files, can also submit the data files using SFTP Server (specific request may be made for SFTP upload).
5. The statement of financial transactions shall be furnished on or before the 31st May, immediately following the financial year in which the transaction is registered or recorded.
6. The statement of financial transaction shall be signed, verified and furnished by the specified Designated Director. Where the reporting person is a nonresident, the statement may be signed, verified and furnished by a person who holds a valid power of attorney from such Designated Director. The data files are required to be uploaded at the reporting portal through the login credentials (PAN and password) of the designated director.
To read more in details, find the enclosed file
CAclubindia
