The Income Tax Department is asking for details of monthly expenses from high income earners. This step has been taken to prevent tax evasion. This step is part of the government's big plan, in which data analytics is being used to prevent tax evasion.

The Income Tax Department is now eyeing those people who have a good income but they withdraw very little money from their bank accounts. The department has sent notices to such people and asked for complete details of their monthly expenses. This includes groceries, clothes, shoes, haircuts, eating in restaurants, flour, rice, spices, cooking oil, gas cylinders, cosmetics, children's education and complete information about family members.

According to Anuradha Shukla's report published in The Economic Times, the department's aim is to find out whether these people are hiding their real income or making large transactions in cash, which may lead to tax evasion. This step is a part of the government's larger plan in which data analytics is being used to prevent tax evasion.

Officials say that these notices have not been sent to everyone but only those people have been targeted who show huge income in their returns, but there is a huge difference between their life and the money withdrawn from the bank. In simple words, if someone is living a luxurious lifestyle, eating in expensive restaurants, wearing good clothes, but withdraws less money from the bank, then the department suspects that he has some other source of income, which he has not disclosed.

It is also possible that he is transacting in cash, the account of which does not reach the government. That is why the department has now started asking for details of every small and big expenditure. In November last year too, the department had run a similar campaign. At that time, notices were sent to those who had hidden their foreign income. This information was obtained from the exchange of information between tax officials around the world.

Like that campaign, this time too the department's focus is on those people whose expenses and income seem to be a bit wrong. An official of the department said that this is not a common notice. This is especially for those people who live a luxurious life, but from the bank's activity it seems that they spend very little. In such a situation, the question arises that where is their money coming from.

According to the department, this action is being taken only on selected high net worth people, about whom concrete information has been received that they are showing their real income less. An official clarified that if there is a balance between your income and expenditure, then there is no need to panic. But if there is a luxury in your life and withdrawals from the bank are negligible, then the department will ask for an answer from you.

Its purpose is to ensure that no one can escape tax by hiding their income. Now, from grocery items to haircuts, Income Tax has a keen eye on everything.