Income Tax Department Investigates Low Bank Withdrawals and Suspicious Spending:

Income Tax Department Investigates Low Bank Withdrawals and Suspicious Spending The Income Tax Department is going to send notices to those individuals whose bank accounts show very low withdrawals, as per the sources. This is the government's strategy to find the possible tax evasion using data analytics. Individuals have to declare the details of their expense usage to the department. They have to explain each and every expense they spent on their daily essentials. As per tax experts, so many individuals have received the notice. However, only those individuals are targeted by the authorities who have high incomes but whose spending is very low. This has made the tax department suspicious because it looks like some income is not being reported correctly. They also have to provide information about family members with their annual income and PAN numbers to the income tax department. And if someone doesn't provide these details, it will be assumed that their family has withdrawn Rs. 1 crore in a year. Authorities have said that the notices are not sent to random people. They target those who seem to live a luxurious life but deposit very little cash in their banks. This pattern indicates something being under the counter, or maybe some hidden means of income or unreported cash transactions. Data analytics has facilitated tax agencies to monitor spending habits more intensely. The department hopes that by monitoring transactions in banks, withdrawals, and consumption, they will be able to uncover differences between reported income and real living patterns. It is hoped that this move will improve tax compliance while curtailing tax evasion.