Show HN: Income Tax Calculator(incometaxcalculator.net.in) |
Show HN: Income Tax Calculator(incometaxcalculator.net.in) |
However, if you are an expert in tax rules, here's something I'd pay money for - clear tax guidance in the form of a decision engine, where I can feed my inputs and get an accurate interpretation of the tax rules. I will pay for this as long as you can back the interpretation by a certified tax consultant.
[1] http://www.incometaxindia.gov.in/Pages/tools/income-tax-calc...
Maybe not, yet. But over a period of gradual improvement, it may offer something unique to certain niche. e.g beginner users, who would prefer a tax calculation tool with a clear and easy to understand step by step guide, followed by some tax related advise etc (something similar to what you've recommended). Thanks.
Indian tax code is beautifully spelled out. It is basically a collection of to-do list items with each item having an extremely simple description. For a nominal Indian, you have to, at the most, read this document till point number 85. All the points are collected in groups. So you if you do not have a non-profit org, for eg., you can just skip that entire section.
Don't judge it by it's length. It is extremely clear. So clear that Income tax is taught in grade 8 and 9 in Indian schools.
"For more than a decade, Mr. Bankman and a small group of tax experts have called on the government to create a tax preparation method that they say would vastly reduce the time and cost of tax-filing for most people. Intuit has been a primary obstacle to the effort."[0]
[0]: http://nytimes.com/2015/04/16/technology/personaltech/turbot...
Every year I seem to have at least one friend ask me to help with their taxes - typically someone who hasn't done theirs in 10 years or more, has no idea where to begin, and whose situation is getting worse every year.
So I always ask the simpletax people to add previous years, even offering to work for them or volunteer time, and the answer has been the same. A very prompt, polite statement that the tax code changes way too much every year and it is logistically impossible for them to cover past years.
I can only assume they're telling the truth and that the problem is impossible for them right now. But it deeply irritates me that the Canadian government doesn't issue its own (free!) software to make it possible for people with the best of intentions to comply with their laws.
I think in the next few decades Indian tax system would equally if not more complicated than the US tax system.
Much as I abhor the complexity of the US tax system (go flat tax!), at least most taxpayers in the US actually pay.
Anyone earning below Rs. 200,000 is exempt from Income Tax
I wouldn't generalise.
http://www.ibtimes.com/how-many-people-india-pay-income-tax-...
Cleartax.in (YC funded) provides a much more comprehensive solution of filing taxes and returns. Although their UI needs a serious upgrade as per today's standards.
Yesterday only, I have used Cleartax.in to file my Income Tax Return. Their service is simple to use and they do appropriate checks to make sure that your filing is consistent.
PS - Not affiliated to Cleartax.
So I don't really see the benefit of using Cleartax for personal filing. It might be feeding on distrust towards Gov services among people. But IT filing tool is already dead simple and easy.
Cleartax may have uses for businesses if they Uber-ify the hiring of CA for short term.
I work at ClearTax http://cleartax.in - so I'll add some feedback here.
Many people find the Government tool intimidating and difficult to use. It is hard to figure out which Form to file (there is ITR-1, 2, 3, 4S, 4) and now there's a new tax form (ITR-2A) which muddies the waters further.
ClearTax identifies the correct tax form for you automatically. You upload your Form-16 (W-2 equivalent for India) and our software will automatically read everything and fill out the correct tax form within seconds. We'll take you through a simplified form which will ask basic questions and help you make progress. If you get stuck, our support team answers questions or you can buy CA assistance for complex plans.
The Government form is sufficiently complicated for Income earned from Rent (if you own a house), because it won't give you the 30% deduction (Section 24) in the ITR-1.
If you need to figure out long term or short term capital gains when you sell assets, the Government form is very very difficult to use even for experts (We have 10K+ Chartered Accountants using the professional version of ClearTax).
I truly believe that the level of cognitive complexity in the Government's tool is much higher than ClearTax.
Lakhs of users in India e-File on ClearTax because they find it simpler than the Government's tool.
I do agree that for an expert user, the tools may feel equivalent :)
Regards, Archit
Only for people with normal jobs or self employed though, doesn't take things like capital gains or dividends into account (but these have nicer rates than normal income anyway, so it's good as a worst case calculator anyway.)
It would be helpful to explain initialisms like TDS for those who don't know.
More here http://en.wikipedia.org/wiki/Tax_Deducted_at_Source
I feel the website is a good starting point but would be nice if it had more sliders for providing various inputs and a real time update of the tax to be paid.
Points noted. It's the initial version of what I wanted to build. I'll add more features gradually as I get some input/suggestion from the users. Thank you.
Are there Indian equivalents to the U.S. payroll taxes or other broad-based, non-consumption taxes?
In the US every state has different income taxes; some don't have income tax at all such as Washington. I always intended to create a US spreadsheet but the task seems daunting.
http://www.moneycontrol.com/news/tax/joint-ownershiphouse-va...
Have you tried to work out capital gains for NRIs ever? It's a quagmire. Try the forums at r2iclubforums.com and you'll see the same question being asked again and again. Why? Because tax rules are designed to be difficult for common man to interpret clearly.
I can foresee a future where legislation becomes ever more complex and people defer to Watson as the source of truth as there will be nobody left in the public service who needs to know the actual text of the law.
Fun times ahead.
Because increasing tax base also means increasing the sources which you can tax. In case of India, nearly all business men don't pay taxes. There is a lot of money exchanged through corruption at all levels, there is money exchanged through gifts, dowry etc etc.
Which is why the biggest reforms pending in India currently is to get everyone to have a bank account, so that they can be paid through a bank instead of handing out cash directly. Once the necessary infrastructure is in place(Bank accounts, connectivity etc), you can start reducing the supply of paper money and have people deal in electronic means. You can increase your tax base and cut a great deal of unaccounted transactions and tax them appropriately. You can also cut corruption since a transaction implies a source and receiver, who need to explain what they are doing when a transaction of money is taking place.
e.g. an overly simplistic tax code could read: everyone pays 18% on all income. All money you get from any source is income.
Now clearly that has some problems - but complexity isn't one of them.
Reporting and fraud are separate issues, or at least separable ones.
I wish there was an easy, silver bullet answer for people who are behind on their taxes, but it really depends on each person's situation.
The better solution is to radically simplify the Income Tax Act. This would make the system easier for everyone and ultimately make products like ours redundant. It's the right outcome and one we'd like to see one day. Until we get there, we fill a critical gap. Free CRA software won't fix the problem and—I'd argue—would be a huge step backwards.
The article you reference basically says that of those who owe taxes the only people who don't cheat are the few who work for large corporations who handle the filing of taxes for them.
People in large corporations are well known to turn in fake rent receipts, produce medical receipts of their relatives/neighbors to claim tax benefits. So whatever 2-3% might be paying, aren't paying it completely.
India needs massive tax reforms.