The Tax Return Preparer Scheme (TRPS) announced by the Income Tax Department helps small and marginal tax payers prepare and file their income tax returns. As per the scheme, over 5000 candidates are trained as Tax Return Preparers at 120 centers across India to create a large legion of qualified persons who can help other file income tax return. In this article, we look at the Tax Return Prepare Scheme in detail with the procedure for becoming a Tax Return Preparer.
How to Become a Tax Return Preparer
Any between the age of 21 to 35 having a degree in Law, Economics, Statistics, Mathematics, Commerce, Management or Business Administration is eligible to become a Tax Return Preparer. Eligible candidate can periodically visit the Tax Return Preparer website and look for openings announced. Approximately, once in every two years, the scheme calls for enrolling of new Tax Return Preparers. Once, an announcement is made, eligible candidates can download the application form from the TRP website or obtain one from a designated NIIT center.
The application form must then be submitted with a demand draft for Rs.100 in favor of “NIIT Limited-TRPSCHEME”. The application forms are processed and upto 5000 candidates will be trained at each of the 120 centers across the country. Once, the training is complete, 500 candidates from each center are selected for taking the enrolment test based on the marks scored.
The candidates are then required to successfully pass the enrolment test, the rest of which is posted on the TRP website. Finally, successful candidates are required to make a security deposit of Rs.1000 and complete a rigorous training program, including web based study material. On completion of the program and the assessment exam, the person is certified as a “Tax Return Prepare”, and provided access to a knowledge portal and help desk to file income tax returns.
Income Tax Returns Filed by Tax Return Preparers
Tax return preparers are allowed to prepare the income tax return for any person whose return of income must be filed under Section 139 of the Income Tax Act.
However, Tax Return Preparers are not allowed to prepare income tax returns of persons carrying on business or profession whose accounts are required to be audited under section 44AB of the Income Tax Act. Also, tax return preparers are not allowed to file the income tax return of any person who is not a resident of India during the previous financial year.
How Tax Return are Filed by Tax Return Preparers?
The Tax Return Preparer would visit you and gather your income and expense details. Based on that information, an income tax return would be prepared. The tax return preparer would then affix his/her signature and furnish it to the Assessing Office having jurisdiction over the assesse. The person for whom the return was filed would also receive a copy of the return for his/her records.
Fee Earned by Tax Return Preparers
Tax return preparers earn a fee as fixed by the Income Tax Department. Tax return preparers can earn a fee equal to 3% of the tax paid on the returns prepared & filed for every new assessee in the 1st year (subject to a maximum of Rs. 1000/-). 2% of the tax paid on the returns prepared & filed for every new assessee in the 2nd year and 1% of the tax paid on the returns prepared and filed in the third year. Tax return preparers are eligible to receive a remuneration of Rs. 250 for the returns prepared & filed for the old assessees.
The fee for filing of tax return should not be charged from the person for whom the tax return is prepared and filed, if the amount of fee earned by the Tax Return Preparer would be over Rs.250. If the fee earned by the Tax Return Preparer is less than Rs.250, then a fee of equal to Rs.250 less fee earned – as per the schedule above can be charged by the Tax Return Preparer.
