What is Income Tax Survey?

An income tax survey is an investigation conducted by the Income Tax Department. Its purpose is to find out the actual income of the taxpayer in a particular financial year. These surveys are performed to understand the financial position of the taxpayer. 

There are some rules that are made by the income tax department. They should be followed while performing the survey of income tax. Some authorities are given the power to conduct these surveys. Such as the Director, Commissioner, Joint Commissioner, Assistant Director, etc. 

Purpose of Income Tax Survey

The purposes of the survey under Income Tax Act are as follows:

• Collect Information: The purpose of the Income Tax study is to collect all the available information related to the assessment.
• Proper Maintenance: The authorities conduct surprise inspections to make sure that the books of accounts are maintained properly and correctly.
• Filing of ITR: To find out the taxpayers who do not file the income tax return despite earning the taxable income. It ensures that the assesse pays the requisite taxes along with all the penalties or interests that are applied. 

Categories of Income Tax Survey

There are three categories under which these income tax surveys are conducted:

1. A special survey is performed on the business premises of the taxpayer.
2. A door-to-door survey on income tax is conducted on-premises, in which the commercial activities and business are being pursued. 
3. A survey of the expenditures is conducted to inspect the scale and nature of the expenses made for various events like birthday parties, weddings, and many more.