SFT Filing in India: Form 61A, Due Dates & Penalties

TL;DR — SFT filing in one minute
• An SFT (Statement of Financial Transactions) is how specified entities report prescribed high-value transactions to the Income Tax Department under Section 285BA.
• It is filed in Form 61A (most reporting persons) or Form 61B (reportable accounts under FATCA/CRS), electronically with a digital signature.
• The deadline is 31 May of the financial year following the year of the transaction.
• Miss it and Section 271FA charges ₹500 per day, rising to ₹1,000 per day after a notice. Inaccurate data can attract ₹50,000 under Section 271FAA.
• Clean books and reconciled data make SFT a routine filing rather than a year-end scramble.

What is SFT filing, in plain English?

An SFT — Statement of Financial Transactions — is a report that certain specified entities must send to the Income Tax Department. It lists high-value financial transactions they registered, recorded or maintained during the year.

The idea is simple. The tax department wants a clear picture of big-ticket money movement — large cash deposits, property deals, bond purchases and the like. So it asks the banks, registrars and businesses that handle those transactions to report them directly.

If your organisation records reportable activity, you must file the statement in the prescribed form, by the deadline, in the correct electronic format. The legal hook is Section 285BA of the Income Tax Act, 1961, with the detailed rules in Rule 114E. You can read the department’s own overview on the Income Tax SFT page.

Founder tip: SFT is a reporting obligation, not a tax payment. You are not paying anything extra — you are just telling the department what already happened. Treat it as a data-quality exercise and it stops feeling scary.

Why SFT filing matters

SFT is more than a box-ticking chore. For the system, it improves transparency and helps the department match what you report against what shows up elsewhere. For your business, it signals strong internal controls.

• Transparency: authorities get a reliable view of high-value transactions across the economy.

• Fewer surprises: accurate reporting reduces the chance of a mismatch notice landing later.

• Better governance: timely, reconciled filing reflects tidy books and disciplined processes.

• Lower risk: non-reporting or under-reporting is exactly what triggers scrutiny and penalties.

Who needs to file SFT?

SFT applies to specified reporting persons listed under Rule 114E — not to every business. The obligation attaches to the type of entity and the kind of transaction it handles. Common reporting persons include:

If your business is under a tax audit, it is worth checking whether your cash receipts cross the reporting line for the year.

What transactions are reported (and the thresholds)

Rule 114E sets a monetary threshold for each category. Below the line, no reporting. On or above it, the transaction goes into the SFT. The department also aggregates transactions of the same nature for a person across the year, so several smaller deposits can add up past the limit.

Watch out: The thresholds are aggregated per person, per category. Two savings accounts in the same bank with ₹6 lakh and ₹5 lakh become ₹11 lakh combined — over the ₹10 lakh limit and reportable. Do not assume a single small transaction keeps you out of scope.

The legal categories under Section 285BA

At the statute level, Section 285BA describes broad classes of reportable activity. Rule 114E then pins down the exact amounts. The broad legal categories are:

• Property & rights: purchase, sale or exchange of goods, property, or any right or interest in property.

• Services: transactions for rendering services above prescribed limits.

• Works contracts: specified transactions under a works contract.

• Investment & expenditure: transactions involving investment made or expenditure incurred.

• Loans & deposits: accepting deposits or taking/repaying loans above the limit.

Because the statute is deliberately broad, the practical test is always the Rule 114E threshold that fits your entity and transaction type.

Which form should you use: 61A or 61B?

Two forms handle two different jobs. Picking the wrong one is a common — and avoidable — filing defect.

In short: Form 61A reports transactions; Form 61B reports accounts. Businesses most often deal with Form 61A. Identifying the right form early keeps your accounting and compliance calendar clean.

How SFT is filed: the process

SFT is furnished electronically, usually with a digital signature, through the reporting portal of the Income Tax Department. Before you hit submit, run through this checklist:

1. Register the reporting entity — obtain the ITDREIN (Income Tax Department Reporting Entity Identification Number) and register the principal officer.

2. Confirm the correct form — Form 61A or 61B, based on what you report.

3. Reconcile the data — match reportable transactions against your books and remove duplicates.

4. Validate the file — use the department’s utility to check the format before upload.

5. Sign and submit — upload with a valid digital signature and save the acknowledgement.

Register and file through the official Income Tax e-filing portal. If your books are already reconciled monthly, this step takes hours, not weeks.

Founder tip: Even if you have nothing reportable in a year, some entities file a preliminary response (a nil / no-transaction statement) to close the loop. When in doubt, confirm your status rather than staying silent.

Due date for SFT filing

The core deadline is easy to remember: 31 May. The reporting period just differs slightly between the two forms.

So transactions in FY 2025-26 are reported in Form 61A by 31 May 2026. Because the base period differs, a pre-filing review well before May keeps you off the penalty clock.

Penalties for non-filing, delay or errors

The penalties are daily and they add up fast. This is why timely filing beats last-minute panic.

The ₹1,000-a-day rate kicks in from the day after the time specified in the department’s notice expires. A single missed deadline that drags on for months can become a serious number. You can review the statutory provisions on the Income Tax Department’s Acts page.

Common SFT mistakes businesses make

• Assuming SFT does not apply without checking the Rule 114E thresholds against actual transactions.

• Ignoring aggregation, so several smaller deposits quietly cross the limit unnoticed.

• Using the wrong form — filing 61A when 61B applies, or vice versa.

• Poor reconciliation, leading to inaccurate data and a Section 271FAA penalty.

• Waiting until late May, when data cleanup and DSC issues create needless stress.

How to stay prepared through the year

SFT is far easier when the work is spread out. A few habits make the 31 May filing a non-event:

• Tag reportable transactions as they happen, instead of hunting for them in May.

• Reconcile monthly so your reported data always matches your books.

• Keep the ITDREIN and DSC current to avoid last-minute registration snags.

• Do a pre-filing review in April to catch gaps with time to fix them.

Businesses with strong monthly accounting rarely feel SFT pressure. This is exactly where a virtual CFO and organised bookkeeping pay off — the data is ready before the deadline arrives.

When to bring in expert help

SFT sits at the intersection of data quality, tax rules and deadlines. If you are unsure whether you are a reporting person, which form applies, or how to reconcile a messy year of transactions, expert help removes the guesswork. A virtual CFO brings the reconciliation discipline and filing rigour to get it right the first time — and keeps your wider accounting and compliance running smoothly.

Frequently asked questions

This guide is for general information only and does not constitute tax, legal or financial advice. SFT rules, thresholds and forms change — confirm the current position with a qualified professional before you file.