If you are reading this piece, there is a very high likelihood that you fall into a tax bracket and file your income tax returns regularly. Many of you likely enlist the help of a chartered accountant to handle your filings and paperwork. During comprehensive financial planning, a professional has ample opportunities to minimize your tax liability because they can advise you on where to spend, invest, and save. All of these recommendations form part of a strategic tax-saving plan. However, numerous professionals even promise massive tax savings right at the moment of filing returns.
At times, this promised figure reaches up to fifty percent. Before evaluating the accuracy of this claim, it helps to understand what a professional actually handles while filing a return. During this phase, their responsibilities typically include
- Claiming all legally available deductions and exemptions.
- Choosing the correct tax regime if the regulations permit it.
- Ensuring that no legitimate tax credit gets left behind.
So, is it truly a straightforward task to slash your tax liability by half while filing returns by keeping these factors in mind? To understand this properly, we consulted tax expert Manish Gupta. According to Manish, upon reviewing a taxpayer's files on certain occasions, a professional might feel confident about saving money through entirely legal avenues. However, there are many instances where they resort to illegal methods to slash taxes. Examples include attaching fake donation receipts, showing contributions to political parties, or submitting fraudulent rental agreements.
The obvious question that arises next is: if the return gets successfully filed and money is saved, what exactly is the issue? Addressing this, Manish Gupta explains that when you pay your taxes through proper channels, you only part with the exact amount you legally owe. On the other hand, if you attempt fraudulent means to bypass taxes and the authorities catch the evasion, you will end up paying the due tax along with penalties and accrued interest. Manish further cautions that anyone making such extravagant claims should be avoided entirely.
