If you pay income tax every year, this update is important for you. The Income Tax Department may soon have the legal authority to monitor your social media, emails, bank accounts, online investments, and trading activities.
If officials suspect tax evasion or undisclosed wealth—such as hidden property, cash, gold, jewelry, or other assets—they will have the power to investigate your digital records. This information was recently revealed in a report by ET.
What Changes Under the New Law?
The proposed Income Tax Bill aims to strengthen measures against financial fraud, tax evasion, and undeclared assets.
Officials have noticed that some individuals withdraw very little from their bank accounts but maintain a high standard of living, raising suspicions.
Currently, under Section 132 of the Income Tax Act, 1961, tax officers can investigate only if they have strong evidence of hidden wealth or property. Earlier, their searches were limited to homes, safes, and lockers.
However, starting April 1, 2026, this right will expand to digital data. If officials suspect tax evasion, they can access personal computers and online accounts to gather evidence.
How Will This Affect You?
If tax officers believe you have not fully disclosed your income or assets, they can now examine your emails, bank accounts, trading platforms, and even social media activity.
As digital transactions increase, tax investigations are adapting to modern technology. The new law will make digital forensics a crucial part of tax inquiries.
However, it remains to be seen whether this move will effectively reduce tax evasion or raise privacy concerns.
How to Stay Safe?
The best way to avoid trouble is to file your income tax returns correctly and on time. Be honest about your income and investments to prevent legal issues.
If you own significant assets or investments, consulting a tax expert can help you stay compliant with the law and secure your financial future.
