- Date : 21/01/2019
- Read: 3 mins
The processing time at present for filing your tax returns is 63 days and it will come down to one day after implementation of the project. Read more about this
The income tax e-filing process is set to see a radical change in processing as the Union Cabinet approved the integration of e-filing and centralised processing of income tax returns (ITRs). The integration is expected to reduce the processing time from 63 days to a single day!
However, the ambitious plan will take 18 months to be realised. The increased speed is expected to save a lot of money that the Central Board of Direct Taxes (CBDT) needs to pay as interest on income tax refund delays.
Related: How is taxable income calculated?
Last month, CBDT had announced plans of return and process simplification, which will also be taken into the fold of this new initiative. Known as ITR CPC 2.0, this project has Infosys developing the integrated portal, which will also facilitate return filing and complete the return assessment and refund processing activities.
Presently, only 0.3% of IT returns are scrutinised but the aim of this initiative is not to increase this percentage. Instead, the government hopes to process returns speedily and transparently and bring in more fairness in the assessment procedure. However, for a return to be processed in a day, it has to be complete and not defective.
Related: Income Tax Returns: Who should file them and when?
How are ITRs processed now?
Presently, taxpayers log into an e-filing portal and file their ITRs. Once this is done, they have to ensure that their return reaches the Central Processing Centre (CPC) by posting the physical copy to Bengaluru, filing through an intermediary or by using a digital signature or electronic verification code. The CPC then processes the returns and generates intimation under section 143(1), generally within 30 days of receipt. The time limit for completing ITR is 63 days.
How will the taxpayer benefit?
Taxpayers currently have to wait for a long time to receive their tax refund. This will become a thing of the past, thanks to the faster processing being set into motion. CBDT will be able to resolve the grievances of taxpayers in a better manner. Assessments will be fairer and more transparent, and also more rule-driven and consistent.
Related: How advance tax can help you stay on track with tax payments
How has Infosys come into the picture?
Infosys presently runs the CPC. When quotations were sought for the ITR CPC 2.0 project, Infosys turned out to be the lowest bidder. Therefore, Infosys will be in charge of coming up with this newly integrated portal and will be the sole service provider providing end-to-end service.
What is the volume of ITRs?
It is increasing every year! For the previous year, 23 crore ITRs were processed. Last year, the number of returns increased by 45% in the case of taxpayers below the Rs 10 lakh income limit and 44% among those with an income of up to 5 lakh. In 2017-18, the growth rates for the same income groups were 16% and 24%.
Related: 8 Incomes you shouldn't miss while filing your IT returns
Here's how to file your ITR
E-filing of returns is hassle-free and convenient. Here's a step by step guide to filing your tax returns online. It's simpler, easier and quicker!
The income tax e-filing process is set to see a radical change in processing as the Union Cabinet approved the integration of e-filing and centralised processing of income tax returns (ITRs). The integration is expected to reduce the processing time from 63 days to a single day!
However, the ambitious plan will take 18 months to be realised. The increased speed is expected to save a lot of money that the Central Board of Direct Taxes (CBDT) needs to pay as interest on income tax refund delays.
Related: How is taxable income calculated?
Last month, CBDT had announced plans of return and process simplification, which will also be taken into the fold of this new initiative. Known as ITR CPC 2.0, this project has Infosys developing the integrated portal, which will also facilitate return filing and complete the return assessment and refund processing activities.
Presently, only 0.3% of IT returns are scrutinised but the aim of this initiative is not to increase this percentage. Instead, the government hopes to process returns speedily and transparently and bring in more fairness in the assessment procedure. However, for a return to be processed in a day, it has to be complete and not defective.
Related: Income Tax Returns: Who should file them and when?
How are ITRs processed now?
Presently, taxpayers log into an e-filing portal and file their ITRs. Once this is done, they have to ensure that their return reaches the Central Processing Centre (CPC) by posting the physical copy to Bengaluru, filing through an intermediary or by using a digital signature or electronic verification code. The CPC then processes the returns and generates intimation under section 143(1), generally within 30 days of receipt. The time limit for completing ITR is 63 days.
How will the taxpayer benefit?
Taxpayers currently have to wait for a long time to receive their tax refund. This will become a thing of the past, thanks to the faster processing being set into motion. CBDT will be able to resolve the grievances of taxpayers in a better manner. Assessments will be fairer and more transparent, and also more rule-driven and consistent.
Related: How advance tax can help you stay on track with tax payments
How has Infosys come into the picture?
Infosys presently runs the CPC. When quotations were sought for the ITR CPC 2.0 project, Infosys turned out to be the lowest bidder. Therefore, Infosys will be in charge of coming up with this newly integrated portal and will be the sole service provider providing end-to-end service.
What is the volume of ITRs?
It is increasing every year! For the previous year, 23 crore ITRs were processed. Last year, the number of returns increased by 45% in the case of taxpayers below the Rs 10 lakh income limit and 44% among those with an income of up to 5 lakh. In 2017-18, the growth rates for the same income groups were 16% and 24%.
Related: 8 Incomes you shouldn't miss while filing your IT returns
Here's how to file your ITR
E-filing of returns is hassle-free and convenient. Here's a step by step guide to filing your tax returns online. It's simpler, easier and quicker!
