The Income Tax department has started a fresh campaign to catch black money hoarders and tax evaders. A new Income Tax notification asked the banks and financial institutions to block bank accounts of those persons who have not updated their personal data and have not linked there bank accounts with Aadhaar .
You have time till April 30 to get your bank accounts linked with Aadhaar, if you do not do that your accounts will be blocked. Not only Aadhaar, you also need to submit know your customer (KYC) details to avoid blocking of your account. You wil also have to self-certify these documents.
If you have opened your bank account between July 2014 and August 2015 and do not want your account to be blocked by the bank, rush to the bank to link your account to your Aadhar number.
Insurance and stock accounts have also been included in the order.
The move comes after Aadhar number linkage was made mandatory for mobile numbers and tax filings. The step would help track tax evaders through the Foreign Tax Compliance Act (FACTA) — a pact signed between India and the US to trade tax related information.
What is FACTA
FATCA is a tax information sharing agreement that India and US have signed. It allows for automatic exchange of financial information between the two nations about tax evaders.
The IT department has asked the banks to inform the account holders about the consequences of non-compliance. “The account holders may be informed that, in case self-certifications are not provided till April 30, 2017, the accounts would be blocked, which would mean that the financial institution would prohibit the account holder from effecting any transaction with respect to such accounts,” the IT department notification said.
The transactions by the account holder in blocked accounts will be allowed once the self-certification is obtained and due diligence is completed.