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It pays to be a CA in these taxing times

Posted on 31 July 2008,    
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Author : Khyati Dharamsi/DNA

Content : Has your chartered accountant (CA) been charging you more than he did over the last few years? Don't blame the inflation alone. The new Indian Income Tax Return (ITR) forms introduced since the last assessment year has forced CAs to increase the fees for filing income tax returns. Before these forms were introduced, the Saral form had to filled up to file the Income Tax returns.
"The Saral form that could be filled up in 10-20 minutes has been replaced by the ITR form, which is more complicated and takes anywhere between 45 minutes and two hours to be filled. For the simplest of forms, people who charged between Rs600 and Rs700 earlier have been charging around Rs800-Rs1,000 now," says chartered accountant PT Poladia.
Moreover, he says, "The income tax department has become more stringent in terms of compliance. Earlier no one use to take interest income from savings bank account into consideration. But now the pass book has to be checked and the income from bank interest included, or else CAs are questioned during scrutiny."
Nimesh Dedhia, chartered accountant at PND & Associates confirms saying, "The fees has gone up by around 20% since the ITR forms have been introduced."
Another reason for the increase in rates is the fact that for the financial year 2007-08 a lot of investors sold shares at a loss and hence made short term capital losses. This introduces another level of complexity to the entire process of filing income tax. Hence some CAs have been charging more only to those who have complicated tax computations as a result of short term capital losses from selling shares.
"The hike in fees has been more this year compared with last year as a result of rising inflation. But there is no blanket increase in the fees. The increase is on a case-to-case basis. There are many clients, who have been with us for years together and we have built a relation with them. We haven't increased the fees for them. However, fees has been increased by 50-100% for around 60% of the clients," said chartered accountant Vijay Kewalramani, who runs VN Kewalramani & Associates.
Another CA said, "Some CAs have increased the rates under the garb of ITR forms being complicated and hence consuming more time, but the actual reason for the increase in inflation and other rising costs."



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