Forms 97 and 98 officially replace the previous Forms 60 and 61 as per the government of India: a tax compliance update. This shift is one aspect of an expanded reporting effort to streamline reporting and to facilitate the tracking of financial transactions with those who do not have a Permanent Account Number (PAN). In the past, Form 60 was for the non-PAN persons who had to make a declaration when they were going through certain activities such as opening bank accounts, buying property, or making large financial investments but did not have a PAN. Since the reform process is now based on the former system, this declaration has to be made through Form 97.
Form 97 has a similar purpose, but now in a format consistent with what is acceptable in current regulations and digital reporting format. Similarly, Form 61, which institutions that received Form 60 declarations filed, has now been replaced with Form 98. The new form for the latter is required by banks, financial institutions, companies, registrars, and other entities that have collected the mandatory form from the non-PAN holders. The reporting agencies have to keep accurate records and report the collected information to the tax authorities within the prescribed timeline.
The availability of Forms 97 and 98 should improve clarity, efficiency, and transparency in financial reporting by bringing new formats, such as Forms 97 and 98, into the tax reporting process. It also supports the government’s general interest in financial compliance to better streamline compliance and increase accountability to avoid recording and documentation errors. Tax authorities advise businesses and organizations to adapt their internal systems to these alterations immediately.
Non-PAN persons are also advised to be apprised of the new filing requirements so that there is no confusion in transactions. Non-use of these revised forms would then prompt delays in filing, and failure to comply would result in the declarations being denied. As tax regulations evolve rapidly, it is very important for taxpayers as well as reporting bodies to be aware of such changes. Another important step to make is the switch to Forms 97 and 98 in a more streamlined digitalized tax administration system for each Indian taxpayer.
