AIS & TIS
High-Value Financial Transactions (SFT) That Trigger Tax Department Queries
The SFT codes and Rule 114E thresholds behind the entries in your AIS: cash deposits, credit card payments, fixed deposits, mutual funds, shares and property. What each code means, who reports it, and what to keep ready if the department asks.
myutils.meUpdated 7 min read
Open the SFT section of your AIS (Annual Information Statement) and you will see entries such as SFT-005 or SFT-016(SB). Each one comes from a Statement of Financial Transactions. Banks, mutual funds, card issuers, companies and property registrars must file this statement every year under section 285BA of the Income Tax Act, 1961 and Rule 114E. It is due by 31 May after the financial year ends, so FY 2025-26 transactions show up in AIS from around June 2026.
None of this involves TDS. A transaction can be reported even if no tax was deducted on it.
The department sets these entries beside your return. Say your ITR for AY 2026-27 shows a salary of ₹9,40,000, and your AIS shows SFT-006 credit card payments of ₹14,20,000 for the same year. That gap is the kind of thing that gets a query. The department has also run e-campaigns that email and text taxpayers whose reported transactions don't line up with their returns, asking them to respond on the Compliance Portal.
The SFT codes and their thresholds
These are the reporting thresholds in Rule 114E that apply to FY 2025-26 (AY 2026-27). The code number is the transaction's serial number in the rule's table.
| Code | Transaction | Who reports | Reported when (per financial year) |
|---|---|---|---|
| SFT-001 | Bank drafts, pay orders or banker's cheques bought in cash | Banks, co-operative banks | ₹10 lakh or more in total |
| SFT-002 | Prepaid instruments (RBI-issued) bought in cash | Banks, co-operative banks | ₹10 lakh or more in total |
| SFT-003 | Cash deposits or cash withdrawals in current accounts | Banks, co-operative banks | ₹50 lakh or more in total, across one or more accounts |
| SFT-004 | Cash deposits in accounts other than current accounts and FDs | Banks, co-operative banks, post office | ₹10 lakh or more in total, across one or more accounts |
| SFT-005 | Time deposits (other than renewals) | Banks, co-operative banks, post office, Nidhi, NBFCs | ₹10 lakh or more in total |
| SFT-006 | Credit card bill payments | Banks and other card issuers | ₹1 lakh or more in cash, or ₹10 lakh or more by any mode |
| SFT-007 | Buying bonds or debentures | The issuing company or institution | ₹10 lakh or more in total |
| SFT-008 | Buying shares, including share application money | The issuing company | ₹10 lakh or more in total |
| SFT-009 | Buy-back of shares | The listed company | ₹10 lakh or more in total |
| SFT-010 | Buying mutual fund units | The mutual fund (through its trustee or AMC) | ₹10 lakh or more in total |
| SFT-011 | Buying foreign currency, including forex cards and travellers' cheques | Authorised dealers and money changers | ₹10 lakh or more in total |
| SFT-012 | Purchase or sale of immovable property | Registrar or sub-registrar | ₹30 lakh or more, by price or stamp duty value |
| SFT-013 | Cash received for goods or services | Businesses whose accounts are audited u/s 44AB | More than ₹2 lakh in one transaction |
SFT-014 covered cash deposits between 9 November and 30 December 2016, the demonetisation window, and won't appear for recent years. Codes SFT-015 to SFT-018 carry no threshold. They report dividends (SFT-015), interest (SFT-016, with suffixes such as SB for savings and TD for time deposits), and sales and purchases of securities (SFT-017) and mutual fund units (SFT-018). That is why your AIS shows savings interest and share sales of any size.
From 1 April 2026 the Income-tax Act, 2025 and its rules replace the 1961 Act and Rule 114E, and section and rule numbers change. For transactions from FY 2026-27 onwards, check the thresholds in the current rules rather than this table.
The categories that come up most
Cash deposits: ₹10 lakh and ₹50 lakh
- Savings and other non-current accounts (`SFT-004`). The bank adds up cash deposited across all your non-current accounts with it during the year. At ₹10 lakh it reports the total against your PAN. Each bank reports separately.
- Current accounts (`SFT-003`). The threshold is ₹50 lakh, and it counts cash deposits and cash withdrawals.
Credit card payments: ₹1 lakh in cash, ₹10 lakh in all
Paying a card bill with ₹1 lakh or more in cash during the year is reported. So is paying ₹10 lakh or more in total by any mode, including NEFT, UPI or auto-debit. If your card spending runs well above the income in your return, the department can ask where the money came from. Unexplained expenditure is dealt with under section 69C.
Fixed deposits, mutual funds, shares and bonds: ₹10 lakh
- Fixed and recurring deposits (`SFT-005`). New deposits of ₹10 lakh or more in total with one bank, post office, Nidhi or NBFC during the year are reported. Renewals are left out.
- Mutual funds (`SFT-010`), shares (`SFT-008`) and bonds or debentures (`SFT-007`). These are reported when your purchases reach ₹10 lakh in the year. The company or fund reports the money it received from you.
Property: ₹30 lakh
When a sale deed is registered, the sub-registrar reports the purchase or sale under SFT-012 if the price or the stamp duty value is ₹30 lakh or more. Both buyer and seller can see the entry in their AIS.
- Buyers should be ready to show where the money came from: a home loan sanction letter, the proceeds of redeemed investments, or a gift deed with bank transfers.
- Sellers report the capital gain in Schedule CG of the ITR. Under section 50C, if the stamp duty value is more than the price, the stamp duty value is generally taken as the sale consideration.
When a transaction can't be explained
An SFT entry is not income in itself. It becomes a problem only when you can't show where the money came from. In that case, the Income Tax Act, 1961, which applies to FY 2025-26, lets the Assessing Officer treat the amount as income under one of these sections:
- Section 68 covers cash credits in your books.
- Section 69 covers unexplained investments.
- Section 69A covers unexplained money or valuables.
- Section 69C covers unexplained expenditure.
Income added under these sections is taxed under section 115BBE at a flat 60%. No basic exemption, deduction or set-off of losses is allowed against it.
| Component | Basis | Share of the unexplained amount |
|---|---|---|
| Tax u/s 115BBE | Flat rate | 60% |
| Surcharge | 25% of the tax | 15% |
| Health and education cess | 4% of tax plus surcharge | 3% |
| Total tax | 78% | |
| Penalty u/s 271AAC | 10% of the 60% tax | 6% more, if levied |
On ₹5,00,000 that can't be explained, the tax comes to ₹3,90,000. The penalty would add ₹30,000 more.
How to stay ahead of a query
- Read the SFT section of your AIS before you file. For each entry, make sure you know where the money came from and that the income side is in your return.
- Give feedback on wrong entries. If an entry overstates the amount, repeats another or isn't yours, say so in AIS. Our guide to AIS feedback explains each option.
- Pay card bills from your bank account. It keeps the trail between taxed income and spending simple.
- Keep proof of large funds that aren't income. Gifts from relatives are exempt under section 56(2)(x), but keep a gift deed and send the money by bank transfer. For loans, keep the agreement and the bank entries.
myutils.me is an independent app, not affiliated with the Income Tax Department. It can bring back the AIS and TIS of each PAN you add, so a family or a CA's client list can be read in one place before filing. Data refreshes when you add a PAN or press Sync. It does not check on its own.
Topics
- SFT
- AIS
- AY 2026-27
- Tax Compliance
myutils.me
Tax Compliance Research Team
Written by the team behind myutils.me, a free, independent app that brings ITR status, refunds and AIS/TIS for each PAN into one dashboard. Check anything important against the Income Tax portal before you act on it.
