Banks, NBFCs, Post Office mandated to report interest credited in any deposit account without any threshold

CA. Manoj Gupta

As per rule 114E(2) the statement referred to in rule 114E(1) shall be furnished by every person (In Form No. 61A) in respect of all the transactions of the nature and value specified. Accordingly,-

(i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 applies (including any bank or banking institution referred to in section 51 of that Act);

(ii) Post Master General as referred to in clause (j) of section 2 of the Indian Post Office Act, 1898.

(iii) Non-banking financial company which holds a certificate of registration under section 45-IA of the Reserve Bank of India Act, 1934, to hold or accept deposit from public.

is required to report about interest credited to deposit account. As of now, the information is to be reported for all account/deposit holders where cumulative interest exceeds Rs 5,000/per person in the financial year.

CBDT vide Notification No. 1 of 2023, dtd. 5-1-2023 [DGIT(S)/ADG(S)-2/Reporting Portal/2021/180] has provided that the information is to be reported for all account/deposit holders where any interest exceeds zero per account in the financial year excluding Jan Dhan Accounts.

In the view of the changes mentioned above, the limit prescribed in Notification 2 of 2021 dated 20th April 2021 stands abolished and this addendum will come into effect from 05/01/2023.

Therefore, from 05-01-2023 the banks, post office will report each entry of interest credited in any deposit account irrespective of amount involved except the case of tax Dhan Accounts.