Tax Consultant
A tax consultant is a financial expert specializing in tax law, compliance, and planning. They provide advice to individuals and businesses, ensuring tax efficiency and legal adherence, and assist in filing tax returns and minimizing liabilities.
What is a Tax Consultant?
Professional tax is a direct tax that is deducted from your gross salary by your employer.
This tax is levied by the state government and thus can vary depending on the state you live in. The maximum limit of which you can be charged is Rs 2500.
The tax is calculated based on the slabs. Each state can have different salary slab rates for the calculation of professional tax. Andhra Pradesh, Maharashtra, Gujarat are some of the states where this tax is applicable.
What Does a Tax Consultant Do?
Tax consultants are aware of all the regulations applicable as per the Income Tax Act that every organisation and individual has to abide by at the time of filing taxes. You can meet your consultant in person, or you can also talk on the phone regarding the filing of taxes.
Other than income tax e-filing, there are other services that a tax consultant offers. These include:
- Tax documentation
- Filing income tax returns for freelancers.
- E-filing income tax
- Evaluation of the financial and legal circumstances of clients to understand their tax liabilities.
- Completion of forms like Form 21B, Form 16, etc., and submitting them on the official Income Tax website and also sending them to the Bangalore office of the department (if required).
- Helping you invest in some of the top tax-saving schemes like health insurance, life insurance, child plans, PPF, and other schemes that the government has introduced.
Advantage of Tax Consultant
Expert Knowledge:
Tax consultants possess in-depth understanding of tax laws and regulations, ensuring accurate compliance and identifying potential deductions and credits to minimize tax liabilities.
Time-Saving:
They handle complex tax-related tasks, saving individuals and businesses time and effort, allowing them to focus on core activities.
Risk Management:
By staying updated with changing tax laws, tax consultants help mitigate risks of audits, penalties, and legal issues, providing peace of mind.
Strategic Planning:
They offer strategic tax planning advice, aiding in financial decision-making, optimizing tax positions, and improving overall financial health for both short-term and long-term goals.
Services Provided by Tax Accountants
Tax consultants offer a variety of services to their clients from preparing your tax return to helping you with your very complex personal financial situation. The most popular services that are offered to clients include:
- Preparing your tax return
- Looking for deductions to lower your tax burden
- Minimizing your tax liability in retirement
- Dealing with taxes on rental property income
- Helping manage your capital gains taxes
- Sorting through the tax implications of life events, like marriages, divorces, deaths and births
Tax consultants usually work for financial consulting firms, public accounting firms or government agencies. On the other hand, some may operate completely independently. In many cases, tax consultant services are available online, although you can also access their services through an office. Clients range from individuals and families to organizations and corporations.
Frequently Asked Questions
Yes, tax consultants and accountants are different. While an accountant helps individuals and firms make financial decisions, a tax consultant specialises in tax-related topics, provides solutions, and helps you file your returns.
This depends on your situation. If you need help in planning your taxes and require advice on investments to save taxes, you can hire a consultant. But it is not mandatory. You can file your tax returns by yourself as well.
There is no particular answer to this question. Every tax consultant charges a different fee, depending on the work, expertise, knowledge, experience, etc. You have to ask the consultant about the fee according to the work that you want them to do. It is advisable to understand the fee structure before you start consulting them.
Yes, it is safe to hire a tax consultant. In fact, they can help you keep your tax records safely and help you abide by the regulations mentioned in the Indian Income Tax Act.