The manual aligns with the changes brought in the Finance Act 2025 and is a major step addressing growing risks linked with virtual digital assets such as cryptocurrencies and NFTs.
Credit report
This is for the first time that the manual permits officers to access credit information from registered credit bureaus such as CRIF High Mark. This is seen as a big leap for the department to carry out financial profiling of taxpayers and identify individuals whose financial behaviour is inconsistent with declared income.
Data analytics
The tax department also has data analytics and embedded technology at the core of its modern investigation architecture.
This is for the first time that the manual permits officers to access credit information from registered credit bureaus such as CRIF High Mark. This is seen as a big leap for the department to carry out financial profiling of taxpayers and identify individuals whose financial behaviour is inconsistent with declared income.
The tax department also has data analytics and embedded technology at the core of its modern investigation architecture.
Under the revised procedures, the officers will use tools to trace crypto transaction trails, study financial behaviour patterns using credit and loan data. The officers will also leverage third-party data to detect inconsistencies between income declarations and lifestyle indicators.
It is believed that this will be a paradigm shift in the tax enforcement system to walk in step with changing the financial ecosystem.
Since the majority of wealth these days is not kept in bank lockers but in mobile apps and digital contracts. Therefore, this manual provides technological backing to taxmen to trace the unreported income of the wealthy.
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