A decade of filing tax online in India

Jun 10, 2016 | Personal taxation in India | 0 comments

Background

I’ve been filing my personal taxes online for a full decade now, and I do believe I was one of the first set of people in India to adopt this mechanism. I filed the first time for FY07 (AY 2007 – 2008) using Skorydov, which later changed their tax solution name to myITReturn. Since then, I’ve tried Taxsmile, Cleartax and HRBlock. This is a story about my experiences using all these e-filing solutions, and it has not always been a bed of roses.

My tax profile

Like most Indians, I believe in declaring whatever earnings occur from multiple sources of income (salary, dividends, interest), short term and long term capital gains (stocks, equity mutual, debt mutual), various exemptions, etc so I exercise any tax filing system to the hilt. I am fairly knowledgeable about Indian tax laws and rules.

Assessment Year

Solution used

Status

07 – 08 MyITReturn No demand no refund from CPC
08 – 09 MyITReturn Demand from AO for Rs 30,000. Harassment case filed against AO. Ongoing.
09 – 10 MyITReturn Demand determined by CPC. Rectification request filed. Rectification processed, no demand no refund.
10 – 11 MyITReturn No demand no refund from CPC
11 – 12 MyITReturn Demand determined by CPC. Rectification request filed. Rectification request rejected. Revised return filed. Return processed, no demand no refund.
12 – 13 TaxSmile No demand no refund from CPC
13 – 14 TaxSmile Refund processed and paid.
14 – 15 ClearTax No demand no refund from CPC
15 – 16 HRBlock No demand no refund from CPC

 

Experience with MyITReturn

MyITReturn was the official partner for tax filing at the organization I was working for at that time. I used their services for the first 5 years.

For AY 07 – 08, no demand notice has been received so far.

For AY 08 – 09, I received a demand notice from Assessment Officer (AO) for more than 30K. This does not seem to be a problem with MyITReturn, so I’m following this up myself. This is a long story and one that I’ll do justice in another article.

For AY 09 – 10, I received a demand notice from CPC. I send them a rectification request, they accepted and hence I resolved this myself with CPC. This may have been a problem with data correctly being sent from myITReturn website to IT dept website.

For AY 10 – 11, no demand notice has been received so far.

So these 4 years I was kind of satisfied.

Problem started with AY 11 – 12 tax return. I got a demand notice from CPC. When I looked through the demand notice, I found a few mistakes made by myITReturn in filing my return. Subsequently I wrote to their helpdesk, but they refused to do anything, claiming that the computation was done correctly.

Again I wrote back and got blatantly false info.

Once again I wrote to helpdesk very strongly asking them to consult tax lawyers because they had violated 3 rules from the IT Act. I pointed out exactly what mistakes they had made and which rules were being violated. Finally they accepted their mistake, and said that they would get the problem rectified with IT department. I sent them explicitly what rectifications need to be made, as well various documents (ITR-V, Form 16, intimation letter) to help them send the rectification request to the IT Dept.

Then there was no further response from them even after multiple reminders over 2 months.

Finally, I escalated via my company (since there was a corporate tie-up) and they immediately responded, and filed a “rectification request” with the IT dept.

Unfortunately problem didn’t end here, the IT dept rightly rejected the rectification return since a “revised return” was supposed to be filed. So MyItReturn created a revised return and sent it to me for verification.

Amazingly, they made a mistake yet again that I had to point out (in calculation of exempt income under Schedule VI-A, section 80G).

Finally the correct revised return was made, and accepted by IT dept.

For AY 12 – 13, when filing the return on their website, I found the following problems:

  • On their website and on their XL template used to enter details of sale of securities, there is no place to enter the expense incurred on buying the security (there is a place to enter only the expense incurred to sell the security). Tried to raise a ticket for this on the website but could not.
  • When entering debt fund details, the system rounds off the number of units bought, which is absolutely incorrect. If I’ve bought and sold 34.xx units of a mutual fund, rounding that off to 35 makes the calculations absolutely wrong, esp when some funds have a  NAV of more than Rs 1000.
  • The Long Term Capital Loss (LTCL) calculated on debt funds after indexation was also wrong.

This was the last straw for me, so I looked through a number of other competing services and settled on TaxSmile.

MyItReturn had lost my business for ever, and of course they are least bothered about it.

Read the review on MouthShut.

Experience with TaxSmile

I used TaxSmile for the next 2 years and by and large things went well.  The website was very usable, well-enabled for power users like me, calculations were correct, support was great, and filing with IT dept was correct, at least since for both those years I haven’t received a demand notice so far.

But the next year, for AY 14 – 15, when filing the return on their website, I found the following problems:

  • After entering all the salary details for 2 employers in the past FY, when I go back and look at the “Form 16 details, Part B”, items 10, Total Tax Payable (Point 16 of Form 16) always reverts to 0 irrespective of how many times I enter a value here. All other fields retain their value.
  • I see no way to enter amount paid towards Sec 80D. Under Deductions > Mediclaim Premium, it says “Please add Mediclaim Premium”, but no way to actually add any amount here.

I dropped a mail to their helpdesk. No answer ever came even after sending multiple reminders, so once again I had to search and find another e-filing solution, and I settled on ClearTax.

Later I logged back into their website and I saw that their problems are continuing:

  • They’ve not given access to my older filing data / status, i.e. for the 2 years that I filed using their platform. This is a big no-no. Any company that holds user data to ransom should be severely blacklisted.
  • Clicking on any of  the “previous data” links throws up a message: You have not Subscribed for this service. To Subscribe for this service kindly Click on the link “Subscribe For Value Added Service” available on “My Taxsmile” Page Under “Manage Your Account”

Obviously they want to charge for this, but what’s worse, there is no link called “Subscribe For Value Added Service” under “Manage Your Account”. So even if one wanted to pay and access the data, there’s no way to. What a joke of a service. I would highly recommend that this service is avoided.

Experience with ClearTax

For AY 14 – 15, I went with ClearTax. Even though I had a problem on their website, they seemed to be the best option.

Correspondence with their helpdesk:

Me: In ITR2, Schedule S, why is “Income chargeable under the Head ‘Salaries'” (#7) reflecting directly in #1? #1 should have only the salary, then exempt allowances should be under #2, perqs should be under #5, etc. Simple mistakes made by intermediates like you cause needless scrutiny and follow-up with the IT department later. Please correct.

CT support: For now, clearTax fills out the Income chargeable under the head Salaries final value and does not fill the breakdown in Schedule S. This is mostly due to the nature of ITR-1 and for helping non expert users actually succeed in their tax returns. ITR-1 only looks at income chargeable under the head of salaries (which is the case for 90% of users). And for ITR-2 this is not a concern typically unless there’s mismatch from the Form-16 issued by your employer (and most people don’t know how to fill these values).

Engineering is investigating whether they can present an “Advanced View” for users who want to fill this in but for now we don’t offer this capability. For now, we can suggest that you e-file (Lakhs of users file ITR-1, 2, 3, 4 etc with ClearTax with zero problems in this matter.)

If you are seeing the taxable salary presented incorrectly, let us know and we will investigate that as well.

Hope this resolves your concern. I am happy to discuss this further.

CT support: Also, if you see any minor disscrepancy, it can be edited manually. Do let us know if there are any further queries. We’ll be happy to answer them.

Me: Thank you for the reply, you’ve given me conflicting replies.

> And for ITR-2 this is not a concern typically unless there’s mismatch from the Form-16 issued by your employer (and most people don’t know how to fill these values).

Like I mentioned on the FB page, obviously I’m concerned coz there is a mismatch in my case. There was no way to enter this data on your website. Then I uploaded my Form16 thinking that you would at least parse the right data from there, but still not.

So how is this problem to be sorted out?

No reply ever came back from them. The ticket was closed as “solved” on Zendesk. Hahaha.

For AY 15 – 16, I tried using ClearTax, and quickly hit upon a problem. I usually have a gadzillion entries to be made for capital gains and losses and rely on XL sheet templates from these sites to enter my data in bulk. But Cleartax seemed not to have any. If someone thinks this is a trivial matter, then they have never had the dubious pleasure of painstakingly entering realms of data one by one into badly designed UX boxes and screens and then cross-checking them to make sure that everything is correct. So I wrote to them:

Me: Where’s the option to upload an XL sheet with details of capital gains? I believe it was there last year.

CT support: No we do not have any option of uploading a XL sheet into our capital gains tab. Thereby you will have to punch in the details one by one into our site and the site will calculate the gains automatically.

Weeeeellll, as one might guess, that was the end of ClearTax for me, and once again I was back to searching for yet another e-filing option. After scouring through so many of the usual culprits and reading the most terrible reviews of all of them on MouthShut, I was quite despairing whether any e-filer could be relied on! I even tried to do the e-filing on my own using the Excel sheet template provided direct by the IT dept. But after being spoon-fed with the superior workflow and UX presented by the e-filing website solutions, using the Excel sheet directly seemed a herculean task. (Actually I did manage to fill out most of the Excel sheet, but quailed when it came to Sec 234! Since I don’t believe in paying advance tax, I rely on paying the penalty at the end of the year using Sec 234. So making a mistake here would be quite counter-productive.) It seems that some super smart folks do claim to be able to use this for their e-filing… more power to them. I chickened out.

Then I stumbled on the new kid on the block, H&RBlock. Initially I was skeptical, but as I started using, it seemed to be well designed and did not have any of the problems faced so far on MyITReturn, TaxSmile and ClearTax.

Experience with H&RBlock

For AY 15 – 16, I went with H&RBlock. It turned out to be a breeze.

I’ll give them a whirl again this year and update if I find any issues.