AIS 2.0 Launched by CBDT: What It Means for Your Tax Filing

The CBDT has brought a significant change for Indian taxpayers the introduction of AIS 2.0 (Annual Information Statement). The update is aimed at making tax compliance easier, correct, and transparent for individuals, companies, and consultants alike.

As tax practitioners, we at Taxflick think this is a positive step towards minimizing tax mismatches, return filing errors, and post-filing notices from the department.

What Is AIS?
The Annual Information Statement (AIS) is a comprehensive financial statement on the Income Tax e-filing portal. It aggregates multiple income and transaction information reported to the Income Tax Department including:

– Salary and interest income
– TDS/TCS information
– High-value transactions
– Foreign remittances
– Investments and dividend receipts

With AIS 2.0, the breadth and usefulness of this statement have grown considerably.

Salient Features of AIS 2.0
1. Real-Time Transaction Updates
As opposed to previous versions that used to update data once a year, AIS 2.0 now updates data quarterly. Transactions such as sale of mutual fund, receipt of rent, and interest on savings are reflected sooner, enabling taxpayers to monitor their financial footprint nearly in real time.

2. Improved Feedback & Dispute Mechanism
Taxpayers are now able to provide feedback online on the AIS portal if there are incorrect, duplicate, or missing entries. This allows for the reported information to be corrected or flagged for verification prior to tax filing.

3. Increased Coverage
AIS 2.0 covers new types of transactions including:

– Cryptocurrency and VDA (Virtual Digital Asset) transactions
– Rental income through digital rental portals
– EMI repayment of education loans
– LRS (Liberalised Remittance Scheme) foreign remittance

This renders AIS a holistic financial snapshot of the taxpayer.

ITR Pre-Fill Integration
Your Income Tax Return (ITR) forms for the FY 2024–25 will now auto-fill all relevant details from AIS. This will minimize human errors and make return filing easier — particularly for salaried and small business taxpayers.

Why This Matters to You
Numerous taxpayers over the years have received notices or scrutiny letters as a result of mismatches between your ITR and the information in AIS or Form 26AS. With AIS 2.0, all these risks can be minimized provided you double-check your AIS prior to filing.

We at Taxflick always suggest you download and check your AIS and Form 26AS prior to uploading your return.

Pro Tip
– Review your AIS at least once a quarter.
– Resolve any discrepancies early through the feedback tool.
– Utilize professional support to reconcile AIS and ITR in case your finances account for several income streams.