What is Form 64D?

Form 64D is a yearly statement that investment funds in India must file with the Income Tax Department. It gives details of the income shared with unit holders during the financial year. This ensures that the government knows how much income was passed on and whether the correct taxes were handled. It must be submitted by the person managing the fund, like a fund manager or trustee. Filing Form 64D on time helps to avoid penalties and keeps the fund in line with tax laws. It’s a way to maintain transparency between the fund and tax authorities.

Who Should File Form 64D?

Form 64D must be filed by investment funds such as Alternative Investment Funds (AIFs) that distribute income to their investors. The responsibility lies with the fund manager, trustee, or whoever is handling the income distribution. They must report the income paid to each unit holder during the year. This helps the tax department keep records of such payments. Filing this form ensures proper tax compliance. It also helps investors get accurate tax credit details.

Due Date for Filing Form 64D

Form 64D needs to be filed by 15th June of the financial year that comes after the year in which the income was shared with investors. So, if the income was distributed during the financial year 2023-24, the form should be submitted by 15th June 2025. Meeting this deadline is important to stay compliant and avoid any penalties or late fees. Timely filing also ensures smooth tax reporting for both the fund and its unit holders.

How to File Form 64D

Step 1: Prepare the Required Information

Before filing, gather the following details:

• Investment Fund Details: Name, PAN, and address of the fund.
• Unit Holder Information: Names, PANs, and addresses of all unit holders.
• Income Details: Amount of income paid or credited to each unit holder.
• Tax Deducted: Details of any tax deducted at source (TDS) on the income distributed.

Step 2: Log in to the Income Tax E-Filing Portal

Access the official Income Tax e-filing portal: https://www.incometax.gov.in.

Step 3: Navigate to the ‘e-File’ Section

Under the ‘e-File’ menu, select ‘Income Tax Forms’ and then choose ‘Form 64D’ from the list of available forms.

Step 4: Fill in the Form

Enter the required details in the form, including information about the investment fund, unit holders, income distributed, and TDS details.

Step 5: Verify the Form

The form must be verified by an accountant. Ensure that all information is accurate and complete before proceeding.

Step 6: Submit the Form

After verification, submit the form electronically using a digital signature. Ensure that the submission is successful and that you receive an acknowledgment.

Benefits of Filing Form 64D

• Fulfills Legal Compliance: Helps the fund stay aligned with Section 115UB of the Income-tax Act, avoiding legal trouble.
• Improves Transparency: Clearly reports income shared with investors, building trust and accountability.
• Avoids Penalties: Timely filing reduces the risk of fines or interest due to non-compliance.
• Supports Tax Credit Claims: Makes it easier for unit holders to claim tax credits on their distributed income.
• Organizes Tax Records: Keeps proper income distribution records for both the fund and the Income Tax Department.

Consequences of Non-Compliance

• Penalty Charges: If the form isn’t filed by the deadline, the fund may have to pay penalties as per the Income-tax Act.
• Interest on Delayed Tax: If any tax amount is unpaid, interest might be added until it’s cleared.
• Legal Trouble: Ignoring the filing requirements continuously can lead to legal action and higher penalties later.
• Loss of Credibility: Non-compliance can affect the fund’s reputation with investors and regulatory bodies.
• Issues for Unit Holders: Unit holders may face problems in claiming tax credits if the income isn’t properly reported.

Challenges in Filing Form 64D

• Getting Accurate Data: Collecting and verifying correct details for all unit holders can take time and effort.
• Portal or Filing Issues: Sometimes, the e-filing website may have glitches or slowdowns, making submission difficult.
• Document Collection: Gathering all the required income, tax, and identity documents before the deadline can be stressful.
• Coordination Delays: Coordinating with accountants or fund managers for verification can slow down the process.
• Understanding Compliance Rules: Staying updated with current tax rules and filing formats can be confusing without expert help.

Conclusion

Filing Form 64D is an important step for investment funds in India to stay compliant with tax laws. It helps ensure that the income shared with unit holders is properly reported to the tax department. By filing on time and following the right process, funds can keep their operations transparent, avoid unnecessary fines, and make sure taxes on distributed income are handled correctly. This simple act supports smooth financial management for both the fund and its investors.

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