How to Become Tax Consultant – Practitioner in India?
In this article, we will discuss meaning of Tax consultants, their job prospects, qualification and other aspects. To begin with let’s see what is role as tax advisers, or tax practitioner use their expertise to help their clients successfully navigate confusing and complex taxation laws of rules of income, expenses, deduction and other options.
Although they are, very busy persons during the period of mandatory return filing when the tax becomes due these professionals help clients avoid incurring tax liabilities. They are experts in taxation law, planning and its compliance. Consultant typically provide guidance and advice to a taxpayer on various aspects. They prepare ITR, GST returns, they also work closely with clients for the whole year and keeping close tab on tax liabilities of their clients.
How to become Practitioner in India
There are many students who want to start their own consultancy. They want to upgrade their practical skills. Anyone who want to start their tax practitioner work in the field of income tax can join Tax practitioner Program and become successful tax consultant in India.
2. What does a tax consultant do?
A tax consultant helps corporate and individuals tax payers to prepare and optimize their tax liabilities. They also represent their own clients to resolve potential tax issues with authorities. Tax advisors, tax practitioners are experts in tax law, planning and compliance matters.
As discussed earlier they serve big business house and individuals by both updating their clients on new tax law and positioning their clients (taxpayers) for short and long-term tax optimization.
They have strong written and verbal communicators able to explain tax law and strategies in a way that is accessible and easy for clients to understand.
They work for accounting firms, law offices, and financial consulting firms. Some of the m start their own tax practice and after some time become successful tax practitioner and many even have their own independent tax preparation and consultation businesses.
3. Duties of tax Practitioner
Their main duty is to guide clients, whether they are corporate business house or individuals to minimize tax liabilities and reduce the complication in calculating taxes for each financial year. He prepares ITR based on latest and updated law and rules regulations, explaining complicated issues related to tax laws to his clients.
He makes sure his clients comply with all tax obligations and receive genuine deductions, which his clients might be eligible for. A consultant might work for himself as a self-employed person or work in an accounting firm, law firm or consulting firm. Some of the prominent duties are given below:-
- Studying tax laws for better interpretations.
- Consulting clients to minimize tax liability
- Communicating with clients to explain tax issues
- Preparing tax returns and filing with tax authorities
- Real Estate planning
- Keeping clients informed about their tax obligations
4. What should I do to be a tax consultant?
There are many people who are interested in tax consultant career that is quite different from mainstream career?. If you want to choose a job where you can help people in taxation matters. A tax consultant should have extensive knowledge and training on taxes, and they can help people with their tax planning and sometime investment decisions.
5. How can one become an tax practitioner in India?
If you want to become an tax consultant in India, you should have knowledge of business, commerce industry, accounting. Which can be achieved by doing gaining diploma in taxation or any commerce related degree. You should study hard not to gain marks on exams but to gain practical knowledge regarding all the tax matters here.
A good tax consultant will always have the latest updated knowledge about tax laws, which can be achieved by experience, which can be gained by working in law firm, CA firm or consultancy firm. More than studies, one must work at the beginning for any accounting firms or under other senior consultants.
Finally, you should have fine understanding of Income Tax Act, Goods and service act of India. Hence, always keep track of all the circulars, news, new rules clauses, provisions and updates regarding tax to provide right advice to your clients. Your basic skill should be Accounting and Tax Knowledge.
6. Education required to become tax consultant
One should have degrees in tax or and accounting, field; however, because no special certification is required, individuals can take up advisory roles after few years of experience in tax related profession. Professionals with both formal education and tax experience are best for these careers.
Qualifications like CA; CPA enhances the job opportunities in this field. Formal education and professional experience needed to support a future as a successful consultant. However, employees who have many years of experience, yet no professional qualification education can also become for advisory roles allowing them to obtain positions as consultants because of their relevant experience alone.
Postgraduate and LLb degree can also be beneficial to the tax advisors career this is a good option for more advanced postgraduate study is through a diploma program in taxation.
IPA offers Diploma in taxation, which provides an in-depth knowledge of tax law and allows graduates to practice as tax consultants.
7. Who needs a tax practitioner?
Many people in this world employ tax experts or take advice from external consultants on regular basis or on contract basis. If someone has complication in tax matters, he would approach a tax consultant for a solution.
Many factors such as retirement savings, mutual fund investments, real estate transactions, trust funds, self-employment income, a home office, income from rental properties tax advisors can be very helpful.
They can also be very helpful if you work and live in different states or countries, when you have an active investing life, or when you buy, sell, or run your own business. It is advisable to consult a tax advisor when you are facing some issues in handling your tax matters. Such situation include
Professional tax advisors can be useful not only during tax filing days, but also throughout the year. These people know latest laws and rules and can advice and money-saving tax strategies, such as effectively timing the sale of various assets. One can taking advantage of all available deductions and credits, and much more.
8. How much do individual tax consultants charge in India?
There are different types of remuneration to a advisor, whether he is full time employed, or self-employed. Every situation has its own pros and cons. On one hand, working with an advisor online is the quickest way to learn and earn, you will get variety of cases to handle and get answers to your tax questions.
On the other hand, tax advisors who work as self-employed has to rely on assignment income, some time you get good fee and sometime you do not have regular income.
Charges of tax consultant varies, which depends entirely on nature and size of work contract. In India usually individual income tax charges varies from Rs.1000 to 2,000, for business returns charges may be high. The TDS and GST returns and registration matter will earn high income.
9. How much does a tax return preparer charge for filing a service tax nil return?
The fees for nil return vary from one consultant to another. CA firms generally charge more for providing tax consultancy , further if it is company return, charges are even more. Hence various factors like the types of returns, type of service providers usually decides the complexity involved in filing the return, etc.
It also depends on the city where the consultant is operating from , in smaller town and cities usually fee is very less as compared to big metro cities where over heads of operations are high.
10. Is a tax advisor the same as an tax accountant?
Many times it has been observed that accountant and tax consultants job overlap each other , for example a CA knows accounting matters as well as tax work, since tax liabilities is calculated on the basis of profit and loss account and balance sheet. Financial Statements are prepared after due diligence by accountant, many times tax planning requires good understanding of accounting and its adjustment and manipulation. Hence a good understanding about accounting is desirable to become a successful consultants.
11. Is it better to be a tax practitioner or an employee?
This is very interesting question to answer, every individual has different aspects of life, few individuals are entrepreneur and target to start their own consultancy, however many opts for a full time job as they see the job more secured and prefer to work under a brand or umbrella.
Many companies like KPMG, Fergusons, Delloitte, offer benefits such as health care, retirement, vacation, paid holidays, sick leave and childcare subsidies to their employees who work as tax advisor.
12. Tax consultancy: How to increase your clients?
Gathering and increasing client base for tax consultants is very laborious, it requires networking skills, expanding the client base also requires investments. However, before starting consultancy firm, an individual should have idea of the market and its potential.
Tax planner should also assess the probable roadblocks before starting their practices in the tax consultancy area. One can avail business loan for starting consultancy business. Consultants
should attend various seminars, business meets to reach out their prospective clients. To increase clients’ base it is crucial to meet small and medium businesspersons.
IPA offers Tax consultant Course in India