The boundary between expertise and accessibility is rapidly disappearing, driven by factors such as intensifying competition, global expansion, expanding entrepreneurial spirit, evolving government regulations, and increasing awareness. In every sector of the economy, expertise is taking centre stage. The primary reason behind this trend is the advancement of technology, which is facilitating the delivery of expertise as a service to a broader audience. In particular, taxation is a field that is becoming increasingly intertwined with technology and accessible expertise. The demand for tax consultants is at an all-time high, and many professionals are leveraging online assisted filing as the new norm to gain an advantage.
What do the services of a tax consultant entail?
Tax advisors can be employed either by an agency or work as independent consultants. In either case, their primary responsibility is to assist clients in legally reducing their tax liabilities through various means, such as identifying deductions and credits, estimating taxes on different investment portfolios, and preparing and filing tax returns. They can also help clients navigate significant life events, including the death of a spouse, marriage, divorce, childbirth, adoption, purchasing a new home, job loss, or inheritance, among others, by guiding tax implications and opportunities. It is advisable for individuals who have experienced such life events to seek the services of a tax advisor to ensure that their tax obligations get correctly addressed.
A tax advisor is sought after by entities, such as individuals, businesses, trusts, and companies, who have intricate financial situations (such as complex investments and deductions) and want to reduce the amount of taxes owed to the authorities. The guidance and assistance provided by a tax advisor may differ depending on the circumstances of the taxpayer. For instance, a person preparing for retirement may receive different advice than an entrepreneur starting a business, and a real estate investor's tax needs may differ from those of a commodities trader.
Defining broad categories of income tax services a tax consultant can help with:
Income Tax Return Filing:
Obtain expert consultation and assistance for filing income tax returns nationwide.
Income Tax Audit Support:
Access professional guidance and support for income tax audits across India.
Tax Consultation for Income Tax Hearings:
Seek advice from qualified experts on legal matters about income tax appeals.
TaxBuddy offers tax consultants in the following areas:
Professional Representation and Appeals:
Benefit from our expertise in providing professional representation and expertly drafting replies and appeals to Income Tax Notices issued by tax authorities.
Corporate Tax Law:
Receive comprehensive assistance with corporate tax matters for both domestic and foreign companies operating in India.
Tax Due Diligence:
Benefit from our expertise in conducting thorough tax due diligence for startups and businesses. We can assist you in fulfilling documentation requirements with government authorities and equip you with numerous tax and regulatory issues.
Personal Taxation Service:
Access valuable advisory services for both resident and non-resident individuals. Our guidance covers diverse income sources, including salary, agricultural earnings, rental income, capital gains from stocks or mutual funds, and more.
NRI Taxation Issues:
Receive specialized assistance tailored to the unique tax laws applicable to Non-Resident Indians (NRIs). We can help you navigate challenges such as double taxation and explore relief options through Double Taxation Avoidance Agreements (DTAA) between countries.
Taxation in Partnership/LLP Firms:
Obtain expert advice on taxation matters specific to partnership and Limited Liability Partnership (LLP) firms.
Taxation Services for Investors:
Benefit from our support and guidance if you are involved in capital gains, share trading, or future and options trading. We can assist you in optimizing your tax situation and ensuring compliance with relevant regulations.
The branches of purposes served by tax consultancy and assistance:
Tax accountants provide a range of services to their clients, which can include the preparation of tax returns, searching for deductions to reduce the tax burden,minimizing tax liability during retirement, handling taxes on rental property income, assisting with the management of capital gains taxes, and addressing the tax implications of significant life events such as marriages, divorces, etcetera. They serve a diverse clientele, including individuals, families, organizations, and corporations.
Also, tax experts can work with investors to design investment strategies that consider their unique tax situations and financial goals, potentially helping them achieve better investment results over the long term.
Online platforms that offer tax filing and planning services are an excellent solution for individuals and businesses seeking accessible, affordable, and diverse tax services. These platforms cater to a range of needs, including salary, business, capital, future and options, and even cryptocurrency for non-resident Indians or residents with foreign income. They also offer services like GST registration, GST compliance for online sellers and freelancers, tax planning for high net-worth individuals, end-to-end compliance facilitation, notice monitoring, arrears calculation, tax return preparation, response preparation, representation, notice management, expert-guided I-T return filing, corrective measures, regular consultations, and instant support via email or phone. These platforms provide complete and expert solutions to I-T notices, ensuring that individuals and businesses are prepared to handle any tax-related issues that may arise. With their diverse range of services, digital platforms make it easier and more convenient for anyone to manage their taxes efficiently and effectively.
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What is the concept of presumptive taxation and how does it work?
Presumptive taxation is a simplified method used to calculate tax liability, primarily aimed at small businesses and professionals. Instead of calculating the actual income and expenses, taxpayers can declare a predetermined percentage of their business turnover or gross receipts as their taxable income. A fixed percentage of this declared income then gets paid as tax. By opting for presumptive taxation, individuals and businesses can simplify their tax reporting process, eliminating the need for maintaining detailed financial records.
Q) Can you explain the concept of advance tax and provide insights into the timing of its payment for businesses?
Advance tax is a system that requires businesses to make prepayments of their tax liability in the same financial year they earn income. It allows for the assessment of income before the year has concluded. If a business's tax liability exceeds Rs 10,000 in a financial year, it becomes mandatory to pay advance tax. The payment of advance tax is divided into four installments, with specific due dates:
The first installment is due on 15th June and should be 15% of the estimated tax liability.
The second installment is due on 15th September and should be 45% of the estimated tax liability.
The third installment is due on 15th December and should be 75% of the estimated tax liability.
The final installment is due on 15th March and should cover the entire tax liability for the financial year.
Q) Which professionals are eligible to file returns under the presumptive taxation scheme?
Under the presumptive taxation scheme, professionals from miscellaneous fields can file returns if their gross receipts for the period between April 1st, 2016, and March 31st, 2017, do not exceed Rs. 50 Lakhs. This scheme offers simplified tax compliance for eligible professionals.
Q) Under what circumstances are businesses and professionals required to maintain accounting records?
Businesses under the presumptive tax scheme are exempt from maintaining accounting records, except in certain cases. They must maintain books of account if their disclosed income is less than 8% of the gross receipts and the total income exceeds Rs. 250,000. Alternatively, if their annual turnover exceeds Rs. 2 crores in the financial year 2016-17. Professionals also need to maintain accounting records if their disclosed income is less than 50% of the gross receipts and the total income exceeds Rs. 250,000, or if their turnover exceeds Rs. 50 Lakhs. These requirements ensure proper financial transparency and compliance with taxation.
Q) What are the due dates for filing business tax returns?
The due dates for filing business tax returns depend on whether a tax audit is applicable or not. If a tax audit is applicable, the due date is 30th September. On the other hand, if a tax audit is not applicable, the due date is 31st July. Businesses must ensure they file their tax returns within the prescribed deadlines to avoid penalties and maintain compliance with tax regulations.