CBDT Abolishes Limit Of Rs. 5,000 For Submission Of SFT In Relation To Interest Income

The Central Board of Direct Taxes (CBDT) has removed the limit of Rs. 5,000 for the submission of a Statement of Financial Transactions (SFT) in relation to interest income with effect from January 5, 2023.

With the exception of "Jan Dhan Account" holders, the information in SFT must now even include information about account holders earning interest income up to Rs. 5,000.

Specific individuals are required by Section 285BA and Rule 114E to report interest transactions in Statements of Financial Transactions (SFT). The CBDT released Notification 16/2021 on March 12, 2021, to include the reporting of information relating to interest income for the purposes of pre-filling the income tax return (ITR).

The Director General of Income-Tax (DGIT Systems) is required by Rule 114E(4b) to specify the processes, data structures, and standards for ensuring secure data capture and transmission, as well as for developing and putting into practise the necessary security, archival, and retrieval policies.

As a result, Notification 2/2021 (Systems) dated April 20, 2021, provided notification of the format, procedure, and guidelines for the submission of a statement of financial transactions (SFT) for interest income.

Notification No. 1 of 2023

Date: 05.01.2023

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