What is Form 61A? Statement of Specified Financial Transactions

The Income Tax Department in India has several measures in place to ensure that taxpayers belonging to different categories do not evade taxes. Form 61A is one such requirement that specifically helps the department track certain specified financial transactions (SFTs). In this article, we’ll discover what Form 61A is, which transactions it covers, who needs to furnish this form and more. 

What Is Form 61A?

Form 61A is a specific statement of specified financial transactions that eligible entities and taxpayers must furnish to the Income Tax Department each year. The form is required to be filed u/s 258BA of the Income Tax Act, 1961, which makes it mandatory to report SFTs to the government. As per the associated Rule 114E of the Income Tax Rules, these transactions are to be reported via Form 61A. 

This statement is divided into four key parts, as explained below:

• Part A: Details of the statement

Here, information about the reporting entity, the principal office and the statement in general are included. 

• Part B: Details in the case of person-based reporting

This information is relevant for person-based reporting. Details in this part of Form 61A include the details of the reporting person, the specified financial transactions and the report number. 

• Part C: Details of bank and post office accounts

Here, you can find the details of bank and post office accounts, the summary of such accounts, the details of the person and more. 

• Part D: Details of immovable property transactions

This part of Form 61A pertains specifically to the details of the sale or purchase of immovable property. 

Specified Persons Responsible for Furnishing Form 61A

The Income Tax Act and accompanying rules leave no room for ambiguity about which entities and persons need to file Form 61A. They include: 

• Co-operative banks
• Banking companies
• Non-banking financial companies (NBFCs)
• Post offices
• Companies that issue shares
• Companies that issue bonds and/or debentures
• Listed companies that buy back their shares or securities 
• Nidhi companies identified in section 406 of the Companies Act, 2013
• Money changers, dealers, offshore banking entities and any other authorised person as per FEMA
• Trustees or other persons who manage mutual funds
• Any individual who is liable to be audited u/s 44AB of the Income Tax Act
• Registrars, sub-registrars and inspector generals who are appointed as per the Registration Act, 1908

Specified Financial Transactions Covered in Form 61A

The Income Tax Act identifies particular high-value transactions as specified financial transactions (SFTs). These are the details that need to be furnished by the specified persons via Form 61A. Check out the details of these transactions in the table below. 

A Step-by-Step Guide to Register for Filing SFTs

Before filing Form 61A as per the Income Tax Act, the specified persons listed above must first register for the same. If you are a specified person, here is how you can do this. 

1. Log into the income tax e-filing portal. 
2. Find the ‘My Account’ tab and click on the ‘Reporting Portal’ option to register yourself. 
3. Then, fill in the details required like the type of form, category, reporting entity’s address, principal officer’s details and more. 
4. Submit these details and then, the Income Tax Department Reporting Entity Identification Number (ITDREIN) will be generated. 
5. A confirmation will be sent to the registered email address and mobile number. 

Also Know How to File Income Tax Returns?

Steps to Furnish Form 61A Online

Once the registration process is complete, it is easy to file Form 61A annually as required. The steps for furnishing this form online are outlined below. 

1. Find the ‘Resources’ tab in the online reporting portal and download the necessary utilities (the Generic Submission Utility and the Report Generation and Validation Utility). 
2. Then, generate the XML file with the details of the specified financial transactions as per the formats published. 
3. Digitally sign the XML file and upload it on the reporting portal.
4. Make note of the acknowledgement number that you receive on your registered email ID. 

Due Date and Penalties 

The due date for furnishing Form 61A is the 31st of May in the assessment year that pertains to the financial year in which the SFTs took place. If a specified person fails to file the form within this date, a penalty of ₹500 is levied for each day of default u/s 271FA of the Income Tax Act. 

In case of such delays, the reporting entity will typically receive a notice from the income tax authorities, requiring that the form be submitted within 30 days of the notice. If the person fails to adhere to this, the penalty increases to ₹1,000 per day of default or delay in filing Form 61A. 

Conclusion

The average individual who is not subject to audit u/s 44AB of the Income Tax Act need not file Form 61A themselves. However, the transactions reported in this form help the income tax authorities cross-verify large transactions and ensure individuals pay taxes on the same, when due. 

So, if you have engaged in any of the specified financial transactions that need to be reported in Form 61A of the Income Tax Act, ensure that you include the details in your income tax return (ITR) to avoid any unpleasant surprises. 

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