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Tax Return Preparer (TRP)

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Tax Return Preparer (TRP)

Aug 2, 2024

5 Mins

Navigating the complexities of income tax filing can be a daunting task for many individuals. To simplify this process and make tax filing more accessible to taxpayers across India, the Income Tax Department introduced the Tax Return Preparer (TRP) scheme. This initiative aims to provide support to taxpayers by training and authorizing individuals to assist in the preparation and filing of income tax returns. This article provides an in-depth look at what a Tax Return Preparer is, their responsibilities, how to find one, the process of availing their services, their fees, and the requirements to become a TRP.

What is a Tax Return Preparer (TRP)?

A Tax Return Preparer (TRP) is an individual authorized by the Income Tax Department to assist taxpayers with the preparation and submission of their income tax returns. Unlike chartered accountants or tax lawyers, TRPs are not required to have advanced professional qualifications. Instead, they are trained to help individuals and small businesses navigate the tax filing process for a nominal fee. However, it is important to note that TRPs are restricted from assisting with cases that require a tax audit.

Responsibilities of a Tax Return Preparer

Tax Return Preparers have several key responsibilities, which include:

Preparing Income Tax Returns: TRPs are tasked with the accurate preparation of income tax returns for taxpayers, ensuring that all necessary information is correctly included.

Submission of Returns: After preparing the return, TRPs submit it to the relevant Assessing Officer or concerned agency, ensuring that all submissions are verified by the resource center.

Acknowledgment Receipt: TRPs are responsible for obtaining a copy of the acknowledgment received from the Income Tax Department. This document serves as proof that the tax return has been successfully submitted.

Monthly Statements: TRPs must submit a statement of particulars to the Resource Centre by the 7th of each month, detailing their activities.

Record Keeping: Maintaining comprehensive records of all tax returns prepared, both for the current and previous assessment years, is crucial for TRPs.

Key Details Maintained by TRPs

For each income tax return they assist with, TRPs must maintain the following details:

Name of the Taxpayer: The full name of the individual or entity for whom the return is being prepared.
Permanent Account Number (PAN): The PAN of the taxpayer.
Year of Assessment: The relevant assessment year for the return.
Total Income: The total income of the taxpayer as reported.
Total Tax Payable: The amount of tax payable by the taxpayer.
Submission Date: The date on which the tax return is submitted.
Acknowledgment Number: The unique number provided on the acknowledgment slip after ITR verification.
Jurisdiction: The jurisdiction of the Assessing Officer handling the case.
Fees Charged: The fees charged by the TRP for their services.

How to Find a TRP

Finding a Tax Return Preparer can be done through several methods:

Income Tax Website: Use the “Locate a TRP” link on the official TRP website to find contact details for TRPs in your area.
Home Visit Registration: Register for a home visit by a TRP via the TRP website. This option allows a TRP to visit your residence to assist with tax preparation.
Helpline: Call the helpline number 1800-10-23738 for assistance in locating a TRP.
Email: Send an email to helpdesk@trpscheme.com to request a TRP assignment.

Step-by-Step Guide to Avail TRP Services

If you wish to use a Tax Return Preparer's services, particularly through a home visit, follow these steps:

Visit the TRP Scheme Website: Go to the Tax Return Preparer Scheme (TRPS) official website where you will find various options including:

Locating TRPs by State, City, Pincode, or Name.

Registering for a home visit.

The website also provides contact details such as the toll-free number 1800-10-23738 and email ID helpdesk@trpscheme.com for additional support.

Register for Home Visit: Click on the “Register for Home Visit” option. You will be asked to provide details such as the type of assistance required, preferred date and time for the visit, and an alternative appointment option. This ensures that a TRP can visit your home to assist with tax return preparation.

The TRP service can be used for various purposes, including preparing TDS statements and filing income tax returns.

TRP Fees and Commissions

Tax Return Preparers are allowed to charge a fee for their services and also earn a commission based on the tax returns they process. The fee structure is as follows:

Flat Fee: The standard fee for preparing and filing an income tax return is Rs. 250, payable by the taxpayer.
Commissions: TRPs earn commissions based on the tax paid by the taxpayer:
First Year: 3% of the tax paid, up to a maximum of Rs. 1000.
Second Year: 2% of the tax paid, up to a maximum of Rs. 1000.
Third Year: 1% of the tax paid, up to a maximum of Rs. 1000.

Note that the fee charged to the taxpayer may be lower than Rs. 250 based on specific terms and conditions outlined by the TRP scheme.

Eligibility to File ITR through a TRP

Individuals who can file their income tax returns through a Tax Return Preparer include:

General Taxpayers: Those required to file their returns under Section 139 of the Income Tax Act.

However, TRPs cannot assist with the following types of taxpayers:

Businesses or Professions Requiring Audits: Taxpayers whose business or profession must be audited according to Section 44AB of the Income Tax Act.

Non-Residents: Individuals who were not residents of India during the applicable financial year.

Notice Respondents: Taxpayers required to file a return in response to a notice under Sections 142(1)(i), 148, or 153A.

Revised Returns: Taxpayers needing to file a revised return unless the original return was prepared through a TRP.

Requirements to Become a TRP

The Tax Return Preparer scheme offers a career path for various individuals, including graduates. To become a TRP, candidates must meet the following requirements:

Educational Qualifications: Candidates must hold a bachelor’s degree from a recognized university in one of the following fields:

Economics (B.A. / B.Sc.)

Law (LLB)

Mathematics (B.A. / B.Sc.)

Statistics (B.A. / B.Sc.)

Commerce (B.Com.)

Age Limit: Candidates must be between 21 and 35 years of age.

If you meet these criteria and are interested in pursuing a career as a TRP, visit the "Procedure to Become a TRP" link on the TRPS website for more information.

Conclusion

The Tax Return Preparer (TRP) scheme is a valuable initiative aimed at making tax filing more accessible and manageable for taxpayers across India. By providing trained individuals to assist with tax return preparation, the TRP scheme helps bridge the gap between complex tax regulations and everyday taxpayers. Whether you are looking to find a TRP to help with your tax returns or considering becoming a TRP yourself, understanding the roles, responsibilities, and processes involved is crucial for effective tax management and compliance.

What is a Tax Return Preparer (TRP)?

Responsibilities of a Tax Return Preparer

Tax Return Preparers have several key responsibilities, which include:

Preparing Income Tax Returns: TRPs are tasked with the accurate preparation of income tax returns for taxpayers, ensuring that all necessary information is correctly included.

Submission of Returns: After preparing the return, TRPs submit it to the relevant Assessing Officer or concerned agency, ensuring that all submissions are verified by the resource center.

Monthly Statements: TRPs must submit a statement of particulars to the Resource Centre by the 7th of each month, detailing their activities.

Record Keeping: Maintaining comprehensive records of all tax returns prepared, both for the current and previous assessment years, is crucial for TRPs.

Key Details Maintained by TRPs

For each income tax return they assist with, TRPs must maintain the following details:

Name of the Taxpayer: The full name of the individual or entity for whom the return is being prepared.
Permanent Account Number (PAN): The PAN of the taxpayer.
Year of Assessment: The relevant assessment year for the return.
Total Income: The total income of the taxpayer as reported.
Total Tax Payable: The amount of tax payable by the taxpayer.
Submission Date: The date on which the tax return is submitted.
Acknowledgment Number: The unique number provided on the acknowledgment slip after ITR verification.
Jurisdiction: The jurisdiction of the Assessing Officer handling the case.
Fees Charged: The fees charged by the TRP for their services.

How to Find a TRP

Finding a Tax Return Preparer can be done through several methods:

Income Tax Website: Use the “Locate a TRP” link on the official TRP website to find contact details for TRPs in your area.
Home Visit Registration: Register for a home visit by a TRP via the TRP website. This option allows a TRP to visit your residence to assist with tax preparation.
Helpline: Call the helpline number 1800-10-23738 for assistance in locating a TRP.
Email: Send an email to helpdesk@trpscheme.com to request a TRP assignment.

Step-by-Step Guide to Avail TRP Services

If you wish to use a Tax Return Preparer's services, particularly through a home visit, follow these steps:

Visit the TRP Scheme Website: Go to the Tax Return Preparer Scheme (TRPS) official website where you will find various options including:

Locating TRPs by State, City, Pincode, or Name.

Registering for a home visit.

The website also provides contact details such as the toll-free number 1800-10-23738 and email ID helpdesk@trpscheme.com for additional support.

The TRP service can be used for various purposes, including preparing TDS statements and filing income tax returns.

TRP Fees and Commissions

Tax Return Preparers are allowed to charge a fee for their services and also earn a commission based on the tax returns they process. The fee structure is as follows:

Flat Fee: The standard fee for preparing and filing an income tax return is Rs. 250, payable by the taxpayer.
Commissions: TRPs earn commissions based on the tax paid by the taxpayer:
First Year: 3% of the tax paid, up to a maximum of Rs. 1000.
Second Year: 2% of the tax paid, up to a maximum of Rs. 1000.
Third Year: 1% of the tax paid, up to a maximum of Rs. 1000.

Note that the fee charged to the taxpayer may be lower than Rs. 250 based on specific terms and conditions outlined by the TRP scheme.

Eligibility to File ITR through a TRP

Individuals who can file their income tax returns through a Tax Return Preparer include:

General Taxpayers: Those required to file their returns under Section 139 of the Income Tax Act.

However, TRPs cannot assist with the following types of taxpayers:

Businesses or Professions Requiring Audits: Taxpayers whose business or profession must be audited according to Section 44AB of the Income Tax Act.

Non-Residents: Individuals who were not residents of India during the applicable financial year.

Notice Respondents: Taxpayers required to file a return in response to a notice under Sections 142(1)(i), 148, or 153A.

Revised Returns: Taxpayers needing to file a revised return unless the original return was prepared through a TRP.

Requirements to Become a TRP

The Tax Return Preparer scheme offers a career path for various individuals, including graduates. To become a TRP, candidates must meet the following requirements:

Educational Qualifications: Candidates must hold a bachelor’s degree from a recognized university in one of the following fields:

Economics (B.A. / B.Sc.)

Law (LLB)

Mathematics (B.A. / B.Sc.)

Statistics (B.A. / B.Sc.)

Commerce (B.Com.)

Age Limit: Candidates must be between 21 and 35 years of age.

If you meet these criteria and are interested in pursuing a career as a TRP, visit the "Procedure to Become a TRP" link on the TRPS website for more information.