In recent years, income-tax filing has become easier owing to many tax- friendly measures taken by the government to simplify the process and encourage more people to file their income taxes. This year too, the government has taken a few steps to further ease the process and experience. Rebates on debit and credit card transactions, direct credit of tax refunds and new forms for tax filing are just some of these measures.
Tax rebate on debit and credit card transaction:
India is an economy that predominantly deals in cash. The reason could be sheer convenience, non-availability of cards to everyone, and the lack of card readers at many business establishments. Now this is set to change if the government sources are to be believed. RUPAY card, India’s own debit card, can be taken by almost everyone and can be used to transact. To encourage this, various steps have been taken. This initiative has a dual purpose. Firstly, there will be tax rebate to consumers and businesses. Second, there will be a lid on black money transactions which is driven by cash culture.
There will be tax incentives for businesses if they take payment using electronic means, debit, and credit card. The incentives can encourage businesses to set up card readers at their establishment. The tax incentives can be 1-2 per cent in sales tax.
Consumers are encouraged to use debit and credit card for their transactions instead of using cash for the same. There will be a tax rebate on the use of cards proportional to the amount spent using the cards.
High-valued transactions must be done through electronic payment system. An extra charge will be levied upon the transactions if they are made in cash.
There is also a proposal to rationalise or do away with the charges on card payments and electronic payments. The charges can be as high as three per cent of the transaction. This step is very important to ensure a significant number of Indians switch to electronic mode of payment from cash payment.
Direct credit of your refund to your account:
The government has also initiated the process to deposit tax refunds directly to the accounts of taxpayers instead of sending cheques at the given addresses. This step is intended to reduce the errors and denial of refund in legitimate cases.
Many times, addresses would have been mentioned wrongly and hence taxpayers would not have received the refund. Sometimes, the names would have been wrongly spelt on the cheque, resulting in dishonouring of cheque. At yet other times, there would have been discrepancies in the account number. This step will do away with such problems.
Moreover, the direct transfer to bank account will get rid of hassles of writing cheque and mailing it to the intended addresses. Direct transfer is more efficient, cleaner, and error-free.
Taxpayers have to make sure that the account number and names are clearly written in their income tax returns filing.
This will enable the income-tax department to quickly process your application and refund directly to your account.
You can check the status of your refund online too. All you have to do is to go to the TIN-NSDL website (https://www.tin-nsdl.com/) and type your PAN number and assessment year. Remember that the assessment year is 2015-2016 for the financial year 2014-2015.
New form for Assessment Year 2015-16:
The income-tax department has also come up with a new form for the assessment year 2015-2016.The new form seeks the following details:
1 Details of all bank accounts: The taxpayers have to fill up details of all the bank accounts. This only includes the bank accounts that are still in use. Provide all the details and select one where you want the refund to be deposited.
2 Inclusion of passport number: There was much hue and cry when the government decided to ask for details of foreign tours in the tax filing form. However, this move has been revoked. Now there is no such need but taxpayers must provide their passport numbers if he or she has been issued a passport.
3 Inclusion of Aadhar card number: This has to be included if the taxpayer has an Aadhar card.
While these steps are meant to simplify the process for income-tax filing, taxpayers too have to take initiatives from their side. To start with, make sure that all the details included in the tax filing form are accurate. Any inaccuracy will compound the problem.
Second, file your tax returns on time. If you delay tax filing, it delays the refund, attracts penalties, and takes longer in processing. Finally, you will get bogged down by the income tax returns form. Make sure you give all details that are relevant as incomplete returns only aggravates what would have been a simple process to begin with.
(The writer is the CEO of BankBazaar.com)
