High-income earners On I-T Dept's Hit list

With information regarding high-value transactions collected from annual information returns, the tax department now intends to closely watch returns of individuals whose income exceeds Rs 10 lakh per annum.

The number of tax payers declaring an income of above Rs 10 lakh is expected to increase by over 50 per cent.

The investigation wing of the income tax department is tracking new areas to create a data bank since the methodologies of tax evasion and avoidance and camouflaging of payments have undergone a sea change.

In addition to the information flowing from the Central Intelligence Bureau, the annual information returns and the banking cash transaction tax, information from newspapers, magazines and the Internet, the department has asked field investigation wings to individually develop databases on educational institutions including, coaching centers, hospitals, nursing homes and diagnostic centers, charitable trusts and religious institutions, cooperative societies, cooperative banks, non-banking financial companies including chit funds.

So if you undertook a high-value transaction last fiscal, like a property deal worth Rs30 lakh, a purchase of Rs2 lakh on your credit card, or a similar investment in mutual funds, you would be well advised to pay your taxes and file your returns by July 31.

Finance Minister P Chidambaram instructed top tax officials across the country on Tuesday to “reach” and “check out” those 6,60,000 individuals who undertook such transactions last fiscal.