The word moving to the next level once again, the AI will change everything in next 5 years. The use of AI tools by Income Tax Department for the ITR processing is just a beginning, yes it is true. The official sources confirm that the use of AI tools for ITR processing from this year. The detailed article is here.
- This year, for the Assessment Year 2023-24, the Income Tax Department is implementing stricter scrutiny of income tax returns. They have developed a specially designed, self-automated, and modified artificial intelligence software program (AI) to analyze the details provided in the returns. The program will start by collecting data linked to your PAN card and then automatically cross-reference it with your Aadhaar card.
- Next, the AI will compare the transactions linked to your Aadhaar and PAN with the bank accounts you have attached to your income tax returns. It will gather information on fixed deposits, quarterly interest payments, share dividends, share transactions, as well as long-term and short-term gains from mutual funds and shares that you have declared in your returns. Additionally, it will investigate any undisclosed bank accounts registered under your name or joint accounts where you are listed as a secondary or tertiary account holder.
- The AI program will also search for accounts held with cooperative banks, local credit institutions, and postal accounts, including fixed deposits, recurring deposits, monthly income schemes (MIS), and senior citizen saving schemes. It will look for investments made in your name or jointly with family members who do not file income tax returns.
- Furthermore, the program will cross-check your PAN card details with the government registry office to identify any recent land or immovable property transactions within the past three years.
- In addition to the above, the AI will examine debit card and credit card transactions, as well as details related to passport, visa, and purchases or sales of two-wheelers or four-wheelers.
- The data collected will then be compared with the information provided in your Income Tax Return and reconciled with TDS details in AS26.
- Based on this comprehensive analysis, the program will automatically calculate the declared and undeclared income tax amount. If any discrepancies are found, a demand notice (under section 143(i)) will be sent to you.
- This AI-ITR program has undergone rigorous testing and has been finalized for implementation starting this year.
- Due to the implementation of this advanced program, there might be a slight delay in the processing of income tax returns. However, all returns are expected to be processed by the last week of July or the first week of August.
- It is important for those who have not yet filed their income tax returns to exercise caution and ensure accuracy while filing, considering the increased scrutiny from the AI program.
