Statement of Financial Transactions – SFT

Statement of Financial Transaction or Reportable Accounts (previously called as ‘Annual Information Return (AIR)) is a format for filing an additional return with the Income Tax Department in Form – 61A, apart from the regular return mentioned under Section 139. The Statement of financial transaction discloses high-value financial transactions carried out by assesses during the financial year. 

As per Section 285BA of the Income Tax Act, 1961 specified entities are required to furnish a statement of financial transaction or reportable statement in respect of specified financial transactions or any reportable account registered/recorded/maintained by them during the financial year  to the income tax department.

Who is required to file Statement of financial transaction (SFT) in Form – 61A?

• Any prescribed person in the case of an office of Government
• Any person who is liable for audit under section 44AB of the Income –Tax Act
• Banking companies
• Trustee of Mutual Fund
• Recognized Stock exchange
• Issuer of credit card
• Financial Institution
• Company issuing shares through Public or Rights Issue
• Duly authorized officer of the Reserve Bank of India
• A Non Banking Financing Company (NBFC)
• Registrar or Sub-Registrar appointed under section 6 of the Registration Act, 1908
• Company or Institution issuing Bonds or Debentures
•  a prescribed reporting financial institutions
•  a local authority or other public body or association
• the Post Master General as referred in Indian Post Office Act, 1898
• registering authority empowered to register motor vehicles under Motor Vehicles Act, 1988
•  the Collector referred in Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
•  a depository referred in Depositories Act, 1996

What is the due date of furnishing Statement of financial transaction?

The statement of financial transactions shall be furnished on or before 31^st May, immediately following the financial year in which the transaction is registered or recorded.

What are the consequence of not filling SFT?

There are 2 cases when Income Tax Authority issued a notice or when Income Tax Authority doesn’t issued a notice :-

• Income Tax authority may issue a notice to the assesee to file the statement within a period not exceeding 30 days from the date of service of such notice. If such person fails to file the statement within the specified time then a penalty of Rs. 1000 for every day levid from the day immediately following the day on which the time specified in such notice.
• Income Tax authority may not issue any notice to the assesee to file the statement in that case it will attract a penalty under section 271FA at the rate of Rs. 500 for every day

What are the consequences of Incorrect filling of SFT?

As per Section 271FAA of the Income-tax Act, if a person who is required to furnish statement of financial transaction provides inaccurate information in the statement intentionally Then, the prescribed income-tax authority may direct that such person shall pay, by way of penalty, a sum of Rs. 50,000/-

Which transactions are required to file this return?

Reportable Transaction	Reporting Person
Credit Card payment of Rs 10 Lakh or more in the year	A banking company or a cooperative bank
credit card bill payment through cash exceeds Rs 1 Lakh in a year	A banking company or a cooperative bank
Cash deposits or cash withdrawals (including through bearer’s cheque) aggregating to Rs. 50 Lakh or more in a financial year	A banking company or a cooperative bank
Aggregate Cash Deposits of Rs 10 Lakh or more in a year in savings bank account	A banking company or a cooperative bankPost Master General
If you purchased bonds or debenture amounting to Rs 10 Lakh or more in a year	A company or institution issuing bonds or debentures.
Payment of Rs 10 Lakh or more for acquiring shares of a company through it’s Public or Rights issue	A company or institution issuing shares
Mutual Fund investment of Rs 10 Lakh or more in a year	A trustee of a Mutual Fund or such other person managing the affairs of the Mutual Fund
Purchase or Sale of Immovable Property worth Rs 30 Lakh or more	Inspector-General or Registrar or Sub-Registrar appointed under the Registration Act, 1908
Buy back of shares from any person (other than the shares bought in the open market) for an amount or value aggregating to Rs. 10 Lakh or more in a financial year.	A company listed on a recognized stock exchange
Receipt of cash payment exceeding Rs. 2 lakh for sale, by any person, of goods or services of any nature	Any person who is liable for audit under section 44AB of the Act.
Receipt from any person for sale of foreign Currency  of an amount aggregating to Rs. 10 lakh or more during a financial year	Aauthorized person under Foreign Exchange Management Act, 1999

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