Home > Income Tax > Help Center > Statement of Financial Transaction Last Updated: Dec 04th 2023
Guide on Statement of Financial Transaction (SFT)
Taxpayers may make high-value transactions without filing income tax returns. The Income Tax Department created a Statement of Financial Transactions (SFT) or reportable account to record these transactions. This helps the Income Tax Department collect data and assures taxpayer compliance.
Section 285BA requires specified persons to provide financial statements or reportable accounts to the Income Tax body or other body.
This document covers
- Who are required to file SFT or Reportable Account?
- What are Specified Financial Transactions?
- Due Date for Filing SFT or Statement of Reportable Account
- Penalty for failure to furnish Statement of Financial Transaction or Statement of Reportable account
- Statement of Financial Transactions that are required to be reported
- Statement of Reportable transactions for purpose of pre filing of Income Tax Return
1. Who are required to file Statement of Financial Transactions or Reportable Account (SFT)?
The following persons are required to file statement of financial transactions or reportable account
- An Assessee
- A prescribed person in case of a government office
- A local authority or other public body or association
- The Registrar or Sub-Registrar appointed under the Registration act 1908.
- The registering authority empowered to register motor vehicles under Chapter IV of the Motor Vehicles Act, 1988
- The Post Master General as referred to in the Indian Post Office Act, 1898
- The Collector referred to in the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013
- The recognised stock exchange referred to in the Securities Contracts (Regulation) Act, 1956
- An officer of the Reserve Bank of India
- A depository referred to in the Depositories Act, 1996
- A prescribed reporting financial institution
- a person, other than those referred above as may be prescribed.
2. What are Specified Financial Transactions?
Specified Financial Transactions means the following transactions.
- Any transaction of purchase, sale or exchange of goods or property or right or interest in a property
- Any transaction of rendering any service
- Any transaction under a works contract
- Any transaction by way of an investment made or an expenditure incurred
- Any transaction for taking or accepting any loan or deposit
3. Due Date for Filing Statement of Financial Transactions (SFT) or Statement of Reportable Account
- The statement of financial transaction or statement of reportable account needs to furnished in Form 61A
- The due date for filing is 31st May immediately following the financial year in which the transaction is registered or recorded.
Example: For the transactions registered in FY 2022-23, the due date is 31st May 2023.
4. Penalty for failure to furnish Statement of Financial Transaction or Statement of Reportable account
- The penalty for non-filing of Form 61A is Rs 500 per day of default. The penalty starts from 1st June if not filed before 31st May.
- If the Income tax department issues the notice to file, the penalty is Rs 1000 per day of default from the day immediately following the due date mentioned in the notice till the date of filing.
5. Statement of Financial Transactions that are required to be reported
The high value transactions are required to be reported by the specified persons and there is threshold for some transactions
| S.No | Class of Person (Reporting Person) | Nature and Value of Transaction |
|---|---|---|
| 1 |
| Cash Deposits aggregating to Rs 10 lakhs or more in a financial year in 1 or more accounts of a person |
| 2 |
| One or more Time Deposits (Fixed Deposits) of a person aggregating to Rs 10 lakhs or more in a financial year Note: Time deposits made through renewal of another time deposit should be excluded |
| 3 | Banking Company or a co-operative bank or any other company issuing credit card | Payments made by any person of an amount aggregating to
|
| 4 | A Company issuing Shares | Receipt from any person of any amount aggregating to Rs 10 lakhs or more in a financial year for acquiring shares issued by company Note: Even if the director of the company is converting their loans to paid up capital, they are also required to file |
| 5 | A Company issuing bonds or debentures | Receipt from any person of any amount aggregating to Rs 10 lakhs or more in a financial year for acquiring bonds or debentures issued by the company |
| 6 | Registrar or Sub registrar under Registration Act | Purchase or Sale of immovable property for an amount of Rs 10 lakhs or more or valuation by stamp valuation authority is Rs 30 lakhs or more |
| 7 | Authorized person under Foreign Exchange Management 1999 | Receipt from any person for sale of foreign currency including any credit of such currency to foreign exchange card or expense in such currency through a debit or credit card or through issue of travellers cheque or draft or any other instrument of an amount aggregating to Rs 10 lakhs or more during a financial year. |
| 8 | Any person who is liable for Audit u/s 44AB of Income Tax Act | Receipt of Cash payment exceeding Rs 2 lakhs for sale of goods or services of any nature by any person |
6. Statement of Reportable transactions for purpose of pre filing of Income Tax Return
CBDT has enhanced the scope of nature of transactions to be reported under SFT. Now the following SFT transactions are also required to be reported
- Capital Gains on transfer of listed securities or units of mutual funds
- Dividend income
- Interest income