Now your Facebook post of foreign travel can land you with Tax Notice: Read all about Income Tax project 'INSIGHT'

Now your Facebook post of foreign travel can land you with Tax Notice: Read all about Income Tax project 'INSIGHT', a new algorithm to catch tax offenders On one hand, you are waiting for your tax refund, but instead, you get a notice from Income Tax Department for an Old Assessment! Or if you have purchased a Luxury Car, villa or have made a foreign trip, but your ITR is not able to justify these expenses, get ready to Receive a Notice from Income Tax Department.

Project Insight

The Income Tax Department launched 'Project Insight' to deter noncompliance, instill confidence that all eligible persons pay the correct taxes, and promote fair tax administration. Tax officials now take action based on the name generated by the platform, according to the new rule. Previously, tax inspectors revisited earlier assessments based on indications that the assessee may have hidden some income-related information. The names are chosen at random. As per the CNBCTV18 report, it's probable that tax cheating occurred four years ago and that we already have information on the issue.

Data Source

https://report.insight.gov.in is the website that tracks all the data of the Taxpayers. Tax Deducted at Source (TDS), Tax Collected as Source (TCS) and Annual Information Statement (AIS) is the major source of Data. For Example, if you buy a luxury car, say BMW, your TCS is collected and is reflected in your 26AS. The Data can also be sourced from the Registrar of Companies (ROC), GST database, Reserve Bank of India (RBI) Records, Central Bureau of Investigation (CBI), Enforcement Directorate (ED), and many others.

Even Social Media Posts are being picked

The goal of the project is to create a "semantic web," in which websites are structured and marked in such a way that computers can read them directly. "On a person, we're building a systematic web. We'll record it if his wife goes to Paris and posts images on Instagram or Facebook.

Income Tax Transaction Analysis Centre (INTRAC)

The INTRAC performs tasks related to data integration, data warehousing, data analytics, web/text mining, alert generation, compliance management, enterprise reporting and research support.

Compliance Management Centralized Processing Centre (CMCPC)

The CMCPC uses emails, SMS, reminders, outbound calls, letters, etc., to support voluntary compliance and resolution. One of the drawbacks of this mechanism is that now Income Tax notice will be based on the name shown by the insight portal (For Example just sending notice based on information of Foreign Trip made by Taxpayer) and not specific information of evasion. Also, the volume and multiplicity of data is a challenge. However, Department has said that they will take enough measures to ensure that due process is followed and enough opportunity of being heard is being given. Source: CNBCTV18