Income Tax :- Increasing e-filing of Income Tax Return
Electronic filing of income tax returns is likely to jump sharply this year as the government has brought down the mandatory limit of online filing to income above Rs.5 lakh from the earlier Rs.10 lakh.
"A large number of people come under Rs.5 lakh to Rs.10 lakh category. The lowering of income limit for mandatory e-filing will give a boost to online filing of returns," Vineet Agarwal, a director at KPMG India, told IANS.
He said online filing was becoming increasingly popular and it has helped in reducing cost and time required for processing the returns.
"It is good for both the taxpayers as well as the government. It is cost effective, takes less time and the processing is faster," Agarwal said.
The government has made electronic filing mandatory for all those taxpayers whose taxable income exceeded Rs.5 lakh in the financial year 2012-13 or assessment year 2013-14. The assessment year is always one year ahead of the financial year.
Until financial year 2011-12, this mandatory limit was for the taxable income exceeding Rs.10 lakh.
Ankur Sharma, co-founder and chief executive officer of TaxSpanner.com, a leading e-return intermediary, said the number of electronic filing of returns is estimated to jump by almost 50 percent this year.
"Last year, nearly 50 percent of tax returns were filed electronically. This year, with the mandatory online filing for individuals earning more than Rs.5 lakh, the penetration of e-filing is expected to be more than 75 percent," Sharma told IANS.
He said the increase in penetration of e-filing in India has been far more sharper than even the countries like the US.
"It took more than two decades for e-filing penetration to reach this level in the US. India has achieved this remarkable feat in just over 5 years," he said.
"Of the e-returns filed, nearly 73 percent have been filed voluntarily by taxpayers indicating the broader acceptance of the convenience of e-filing," Sharma added.
As always, the deadline for filing income tax return is July 31. There is usually a huge rush among the taxpayers in July to file the returns.
Sharma said although there is no procedural changes introduced by the government, e-filing portals have taken several steps to make the process simpler. The new features include e-filing by email, automatic Form 26AS matching and automatic return preparation from digital brokerage statements.
Taxpayers can either file the returns themselves by logging on to the Income Tax Department website incometaxindiaefiling.gov.in, or through e-return intermediaries.
Filing of return through the department's website is free of cost, while e-return intermediaries charge a fee of around Rs.250 to Rs.1,000, depending on the kind of services.
The popular e-return intermediaries are TaxSpanner.com, Taxsmile.com, myITreturn.com, Taxyogi.com, and taxshax.com.
On estimated growth in income tax mop-up, Agarwal said the revenue from the income tax would rise sharply despite a sluggish economic growth, as the government is taking measures to tap tax evaders.
"Revenue will be higher from tax despite sluggish 5-6 percent GDP growth. It will depend more on how the tax evaders and black money is being brought into the tax net," Agarwal said.
Nearly 34 million or just around three percent of the 1.2 billion people in India filed tax returns in 2012-13.
In the union budget, Finance Minister P. Chidambaram has set a direct tax collection target of Rs.6,68,109 crore for the financial year 2013-14, 19.69 percent higher than the last year's figure.
Direct taxes include personal income tax, corporate taxes and Securities Transaction Tax. Income tax contributes more than half of the total direct tax collections.
Source :- http://in.finance.yahoo.com/news