Form 26AS and AIS Explained: What They Show, How to Read Them, and Why They Matter for ITR

I used to file ITR by just looking at my Form 16 and assuming that was everything. Then I checked my AIS one year and found ₹82,000 of FD interest I had forgotten to declare — from a bank account I rarely looked at. Had I not checked, it would have been a mismatch notice from the IT department.

Form 26AS and AIS are the government's view of your income. Understanding them makes ITR filing faster and avoids notices.

What Is Form 26AS?

Form 26AS is a tax credit statement — a consolidated record of all tax that has been deposited with the government on your behalf.

What it shows:

• Part A: TDS deducted by employer (from salary), by bank (on FD interest), by companies (on dividends), by buyers (if you sold property)
• Part B: TCS (Tax Collected at Source) — from foreign remittances, car purchases, etc.
• Part C: Advance tax and self-assessment tax you paid directly
• Part D: Refund details from previous years
• Part G: TDS defaults by deductors (if any deductor failed to deposit your TDS)

Form 26AS is essentially the government's ledger of what you've paid. When you file ITR and claim a TDS credit, the system verifies it against 26AS. Mismatches trigger notices.

How to access: Go to incometax.gov.in → Login → e-File → Income Tax Returns → View Form 26AS. Or directly from TRACES portal (traces.gov.in).

What Is AIS (Annual Information Statement)?

AIS is newer and much more comprehensive. Launched in 2021, it aggregates a far broader range of financial transactions from multiple sources — banks, mutual fund registrars, stock exchanges, property registrars, and more.

What AIS includes that 26AS doesn't:

• Interest income from savings accounts (not just FD TDS)
• Dividend income from stocks and mutual funds
• Capital gains from mutual fund redemptions and stock sales
• Proceeds from property sales
• Foreign remittances received
• High-value cash deposits and withdrawals
• Rent received (if PAN is linked)
• Business turnover (for GST-registered entities)

Think of AIS as the government knowing your complete financial picture — not just what was TDS-deducted.

How to access: incometax.gov.in → Login → Services → Annual Information Statement. You can view it as a PDF or in the interactive viewer.

How to Read and Reconcile AIS

When you open AIS, you'll see each income item with three tabs: "Reported Value" (what the source reported), "Processed Value" (after you confirm/dispute), and "Derived Value" (final used for prefill).

Step 1: Go through AIS category by category (salary, interest, dividends, capital gains, property).

Step 2: For each item, verify if it matches your own records — bank passbook, broker statement, mutual fund account statement, rental agreement.

Step 3: If something is wrong — wrong amount, transaction belongs to someone else, already included elsewhere — use the "Feedback" option to raise a dispute. Common categories: "Income is not taxable," "Income is of other person," "Income already included in other head."

Step 4: The IT department will consider your feedback when processing your return.

Common Discrepancies and What to Do

FD interest reported but you didn't receive TDS credit: The bank may have reported income without deducting TDS (if you submitted 15G/15H). The income is real and must be declared in ITR regardless.

Capital gains from mutual funds look wrong: Fund houses report redemptions to CBDT. If you reinvested proceeds immediately, the gross redemption amount may appear large. Check your actual gain (redemption value minus purchase cost) via your fund house's capital gains statement (CAMS/KFintech).

Dividend income included but you already declared it: If the same dividend appears in both Form 26AS (TDS deducted) and AIS (dividend reported), don't double-count in ITR — just use the AIS figure and claim TDS credit from 26AS.

Property sale appears at full sale value: The registrar reports the full sale consideration, not your capital gain. You declare only the gain in ITR. The AIS figure is informational.

Something in AIS that you don't recognize: This could be a PAN misuse or data error. Raise feedback immediately and also verify if your PAN was used somewhere without your knowledge (check Form 26AS Part G for TDS defaults).

Before Filing ITR — The Checklist

1. Download AIS and Form 26AS
2. Cross-check interest income from all bank accounts against AIS
3. Get capital gains statement from CAMS and KFintech for all mutual fund redemptions
4. Get DMAT P&L statement from broker for stock trades
5. Match TDS credits in 26AS with actual TDS certificates (Form 16A from bank, Form 16 from employer)
6. Check if advance tax payments appear in Part C of 26AS
7. Raise AIS feedback for any errors before filing

The prefilled ITR on the portal uses AIS data. If AIS has errors and you haven't raised feedback, the prefilled data is wrong — and you may either pay excess tax or face a notice for underpayment.

Why This Matters More Than Before

The IT department's computer system (ITDREIN and CASS) automatically matches AIS data with your filed ITR. If you declare ₹5L interest but AIS shows ₹8L, a mismatch notice (Section 143(1)(a)) is generated automatically — no human intervention needed.

Responding to these notices takes time, requires documentation, and causes unnecessary stress. Checking AIS before filing takes 30 minutes and prevents all of this.

AIS and 26AS are public goods that most taxpayers ignore. Use them — they're the government's way of telling you what they know about your income. Better you know it first.