1. Introduction
The Annual Information Statement (AIS) consolidates third‑party data across brokers, depositories, AMCs, banks and registrars — making it the single most important source for identifying capital gains events reported to the Income Tax Department. This guide shows tax & finance professionals how to extract, validate and use AIS data to prepare reliable capital gains computations.
2. AIS: Structure & Where Capital Gains Appear
AIS aggregates Statement of Financial Transactions (SFT) data. Capital‑gain relevant sections typically include: securities transactions (broker SFT), mutual fund redemptions, depository sell/purchase records, and property registrations. The Taxpayer Information Summary (TIS) is a summarized, analyst‑friendly view but AIS (raw) is where transaction‑level details live.
3. Step‑by‑Step Extraction Process
Step 1 — Login
Login to the Income‑Tax e‑filing portal using your PAN credentials and navigate: Services → Annual Information Statement → AIS. Verify the financial year in the selector.
Step 2 — Choose Financial Year & View Sections
Select the relevant FY. Expand sections labeled "SFT - Securities and Mutual Funds" and "SFT - Property Transactions" to see reported transactions. Use search filters (ISIN, broker, RTA) to narrow results.
Step 3 — Download (PDF / JSON)
For manual review download the PDF. For bulk processing or software import, download the JSON — it contains structured fields (ISIN, txn date, txn type, quantity, sale value, reporting source).
Step 4 — Tag & Classify Entries
Mark entries as equity shares, equity mutual funds, debt funds, ETFs, corporate bonds, property sales, etc. Note missing acquisition cost, corporate actions and off‑market transfers which require manual handling.
4. Interpreting Key Fields
AIS lines typically include: transaction type (buy/sell), ISIN, quantity, gross sale value, reporting entity, and reporting date. AIS may not always include cost of acquisition, corporate action adjustments, or broker expenses — these must be fetched from contract notes or RTA statements.
5. Reconciliation: AIS vs. Broker/AMC Records
Always reconcile AIS with broker P&L, demat statements and AMC consolidated account statements (CAMS/KFin). Steps: obtain broker contract notes, match ISINs and dates, adjust for corporate events, remove duplicates, and reconcile dividend reinvestments and switches.
6. Using JSON for Bulk Computation
Import the AIS JSON into capital‑gains software (or Excel with a JSON parser). Map fields to your gains engine, apply FIFO for equities, apply indexation for long‑term debt funds, and compute STCG/LTCG per asset class. Professional tools help detect duplicates and identify missing cost bases.
7. Common Pitfalls & How to Resolve Them
- Missing acquisition cost: Reconstruct using old contract notes, demat transaction history or average cost methods where permitted.
- Duplicate reporting: Ignore repeated entries from multiple reporting sources after verifying source IDs.
- Corporate actions: Adjust cost/holding period for splits, bonus, mergers and demergers.
- Off‑market transfers: Document transfer deeds and compute cost based on original acquisition.
- Property transactions: Validate stamp duty value, TDS (s.194‐IA) and reconcile with sale deed and computation of indexed cost.
8. Special Cases
Mutual fund switches appear as redemptions; treat as sell+buy for the same investor. Buybacks may be reported though shareholder gains may be exempt. Crypto and certain OTC trades may not appear reliably in AIS — maintain parallel records and report accordingly.
9. Reporting in ITR
Populate Schedule CG in the appropriate ITR form. Classify gains into STCG and LTCG, apply relevant tax rates and exemptions (sec 54/54F etc.), claim set‑offs and carry forwards as per law. Ensure amounts match or reconcile with AIS/TIS to avoid mismatch notices.
10. Best Practices & Workflow
- Download AIS JSON annually and store a copy in your records.
- Use capital‑gains software with AIS import support.
- Maintain a central repository of contract notes, demat and RTA statements.
- Perform monthly/quarterly reconciliations, not just year‑end fixes.
- Respond to AIS mismatches promptly via the e‑filing portal’s feedback options.
11. Compliance Risks & How to Mitigate
Incomplete reporting may trigger e‑campaigns or scrutiny notices. Mitigate risk by documenting calculations, retaining evidence of cost reconstruction and proactively correcting AIS entries (mark as 'incorrect' if not yours). Use certified software reports during assessments.
12. Conclusion
AIS is a powerful compliance enabler — but it is a starting point, not the final computation. Accurate capital gains reporting requires disciplined data extraction from AIS, robust reconciliation with primary records, careful treatment of corporate events, and use of specialized tools for bulk processing. When combined with good documentation practices, AIS greatly reduces the incidence of mismatch notices and strengthens defensibility under scrutiny.