Financial consultants, CAs’ details to be part of clients’ income tax forms
Financial consultants, including chartered accountants (CAs), will have to provide their names and registration numbers while filing their clients’ income tax declaration from next year, a move aimed at ensuring ethical practices and better compliance.india Updated: Sep 19, 2016 13:39 IST
Financial consultants, including chartered accountants (CAs), will have to provide their names and registration numbers while filing their clients’ income tax declaration from next year, a move aimed at ensuring ethical practices and better compliance.
The government will make changes in the Income Tax Return (ITR) forms to include such information, Rani Singh Nair, chairperson of the Central Board of Direct Taxes (CBDT), told HT on Friday. This will help crack down on fake consultants and save genuine tax payers from trouble.
However, the onus of the ITR details will remain with the tax-payer. Fake tax professional will be called out and reported to the relevant regulatory body.
India has 7.4 crore-odd tax-payers. A large number of salaried individuals and businessmen take the help of tax lawyers or chartered accountants who charge anything between Rs 500 to Rs 5,000 for ITR filings.
“Grievances have been received from taxpayers that some tax professionals are not carefully submitting the details in the ITR and sometime neither respond to notices/ communications issued by the department nor bring it to the knowledge of the tax payer,” Nair said.
Taxpayers will be able to verify the credentials of tax preparers from the department’s website or from the relevant institute where the complete details of the professionals are available.
“These changes are significant keeping in mind that Prime Minister Narendra Modi has been asking the tax department to bring in policy changes to address concerns cited by the taxpayers,” Nair said.
“This is more for the aid of taxpayers so that they know the credentials of a professional and whether he is competent enough to file the return or not,” she said.
The department will also be able to contact both to ensure that no communication is missed and a taxpayer can get back to the department in time.
K Raghu, former president of the Institute of Chartered Accountants of India, said the move will increase accountability of CAs and also weed out “incompetent and fraud professionals” from the system.
In specific cases like corporate tax or for a business where the turnover is more than Rs 1 crore, CAs are already required to furnish their names, membership numbers and address in the tax audit report.