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Guide to Tax Return Preparer | Company Vakil

Tax Return Preparer? What is it? Let me help you.

You are running a small business or you are a small taxpayer. Your total turnover is not enough. You don’t need to get your tax audit done. Still, you need to file tax returns. What would you do? How would you do it? No need to worry about these questions. Income Tax Department has got you covered. They have conceptualised this Tax Return Preparer Scheme (TRPS) and launched this in 2006-07.

What is TRPS?

It’s a scheme to help small and marginalised businesses and taxpayers to file their income tax returns. Under this scheme, Income Tax Department invites application from the eligible candidates to get trained for filing returns in a proper manner by the department itself.

Procedure

• Interested candidates can visit this website here to apply
• Tax department invites applications every two years approximately according to the requirements.
• Candidates can also apply through NIIT centres once the scheme is announced.
• With a demand drafting of Rs 100 in the favour of “NIIT Limited – TRPSCHEME”, candidates can submit their application form.
• Approx. 5000 candidates will be selected to get trained at 120 centres. Selection is carried by each centre separately so a candidate can apply at more than one centre. After selection he will be allotted a centre as per his preferences.
• The list of selected candidates are published on the website.
• A maximum of 500 candidates can be trained at one training centre.
• Successful candidates have to deposit security deposit of Rs 1000, which is refundable at the successful completion of training.
• After training they will go through an assessment test, passing of same will qualify them as “Tax Return Preparer”.
• This is an initiative from the government so all the training related expenditure is borne by the government. But expenditure for accommodation and transport has to be borne by the candidates themselves.

Eligibility

A candidate must be of age not less than 21 and not more than 35 years old. He should be a graduate from a recognised university in any of the following subjects –
• Economics
• Law
• Statistics
• Management/Business Administration
• Commerce
• Mathematics

Role of TRPs

• They help prepare income tax return of the small taxpayers who have to file their returns under section 139 of the Income Tax Act.
• They are not authorised to prepare returns for those taxable persons who are required to carry tax audit of their business or profession under section 44AB of Income Tax Act.
• They are also not authorised to prepare returns for those who were not residing in India during previous year relevant to the assessment year.
• TRPs should prepare the returns and furnish the same to the assessing officer or any other official concerned and also send a copy to the taxpayer whose returns he is preparing.
• He should also mention his name and signature in the returns.
• He should also retain a copy of the acknowledgement of the returns he prepared.

Fee charged by TRP

• For every new assessee, an amount equivalent to 3% of total taxable amount can be charged as fee for the first assessment year subject to the maximum of Rs 1000.
• For the second assessment year that percentage will decrease to 2% for the same assessee, again subject to the maximum of Rs 1000.
• Same is 1% of the total taxable amount for third assessment year of the same assessee, again subject to the maximum of Rs 1000.
• After that, a sum of Rs 250 should be charged as fee by the TRP for the same assessee.
• In case of change of TRP by the assessee of taxpayer between the assessment year, fee should be adjusted as required.

Removal of Tax Return Preparer

As per the rule 52 of Income Tax Rules, 1962, certification of Tax Return Preparer can be removed by the Resource Centre or any other concerned authority, if he is found to be doing any misconduct or fraudulent activity while preparing returns. His certificate can also be withdrawn for following reasons –
• Even if he is found to be deficient in his work, adverse action can be taken against him.
• Having a huge responsibility of filing returns for taxpayers, he should be very precise in his work. Failing of the same may result in furnishing wrong information which is an offence.
• If he fails to put his name and signature also then that also constitute deficiency on his part.
• Upon providing all the relevant information by the assessee, he mistakenly fails to put in those information.
• Any repeated mistakes in filing returns such as in computation etc.
• In case he makes false claim of disbursement of fee from the assessee.
• If he fails to improve his skills as per the order of Resource Centre.
• Engagement in forgery, fraud or any other malicious activity will render his certificate withdrawn.
• At last, in case, the scheme has been withdrawn by the concerned authority.

The relationship between Tax Return Preparer and the Taxpayer is a relationship of trust and the same should be maintained through out by the TRPs.

Now you know what TRP is. If you are a small taxpayer and you are required to file Income Tax then feel free to contact Company Vakil regarding the same.

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