Centralized Processing Cell (TDS)

Our Vision : To partner in the nation building process through progressive tax policy, efficient administration and improved voluntary compliance.

Our Mission :  To formulate progressive tax policies  To make compliance easy  To enforce tax laws with fairness  To deliver quality services

 To continuously upgrade skills and build a professional and motivated workforce.

Approach & Strategy

Uniformity

Uniform interpretation of law & procedures

Simplification

Simplification & standardization of Backend & Frontend processes.

Accessibility

Services at the doorstep of taxpayer – any time/anywhere

Good tax Governance

Robust reconciliation of tax collected vis-à-vis tax credits claimed

Empowerment

Empowering the taxpayer with information

USAGE - Facilitating Easier Compliance

TDS Landscape Deductors TDS statements

15 Lacs 60 Lac involving 66 Crore transactions

Nature of payments

20+ Types of payments involving 41 lac crore (35% of GDP)

Contribution of TDS

40% of net Tax collection - 3 Crore Challans

Taxpayers Involved

93% of Taxpayers (26AS PAN ledgers)

Integrated Platform

CPC (TDS) Online Portal …Single window service

Deductor

Multiple Channels of Communication

Document Management System

…Call Centre, e-mail, SMS and Portal

….e-office

Assessing Officer

Analytics …for Risk profiling, Trend Analysis, Patterns and MIS

Taxpayer

Reengineering of processes-

Centralized Processing Cell(TDS)

CPC (TDS) Re-engineering

Acceptable Legal Tender

No Acceptance

Before CPC (TDS) Manual TDS certificatesNo Reconciliation and Major Cause of Mismatch.  Whether Tax has been deducted? - May be, Not Known  Whether Tax has been deposited to the Government Account? - May be, Not Known

CPC (TDS) Re-engineering Outcomes After CPC (TDS)-Complete Reconciliation  Tax deducted and deposited  Certificates verifiable online through a reference number  Digital TDS certificates

generated on the basis of data reported by deductors,

assuring perfect match  Certificates issued by TRACES

only ensures authenticity

Solution- Post CPC(TDS) – Game Changer

26AS generated by CPC (TDS) is used at CPC ITR Perfect TDS Match at ITR CPC

Deductor files TDS statement that goes to TDS CPC

Tax payer uses 16A for ITR filing

Form 16A is downloaded by Deductor from CPC -TDS Tax Payer

Deductor

Deductor issues Form16A to the Tax Payer More Than 200 Million TDS certificates generated

Empowering Assessing officers

-Centralized Processing Cell(TDS)

CPC (TDS) Re-engineering Outcomes

Demand Intimation – Before CPC (TDS)

Challenges: • Manual and Unorganized process of printing and dispatch of intimations

Taken Over by CPC (TDS)

• Due to limited manpower, issue of intimations in all the cases could not be ensured • Manual Record Management • Core enforcement functions of the Field Officers were neglected

CPC (TDS) Re-engineering Outcomes

e-Office After CPC (TDS) Field TDS officer

Field TDS officer

Field TDS officer

• Complete transparency as stakeholders can track the action taken by other stakeholders e.g. grievance handling

• Online repository of notices and orders • Focus on Enforcement actions

Field TDS officer

Field TDS officer

Field TDS officer Field TDS officer

• Consolidation of “manual generated demands and system generated demand” on one platform. • Time barring action related alerts through system

Report of 15CA forms

Risk Profiling- Based On Late Payment (Non-govt Only; Fy2013-14) Errant = 1%

DEDUCTOR TYPE ERRANT NEGLIGENT UNAWARE COMPLIANT TOTAL

DEDUCTOR COUNT 11,136 186,180 33,659 979,460 1,210,435

DEDUCTOR COUNT (%) Negligent = 15%

0.92% 15.4% 2.8% 80.9% 100%

Unaware = 3%

Compliant = 81%

ERRANT GROSS LPI AMT (IN CR.) GROSS LPI PER DEDUCTOR (IN INR) TOTAL TDS AMT (IN CR.) ON 27-APR-2015 - LPI AMT (IN CR.) ON 27-APR-2015 - LPI PER DEDUCTOR (IN INR)

123.9 111,284 1,081.9 157 140,990 14 of 17

NEGLIGENT 614.7 33,017 83,921.6 424 22,762

UNAWARE 188.5 56,000 42,686.2 1 243

COMPLIANT 76.8 785 115,942.6 22 222

TOTAL 1,004 8,294 243,632 603 4,984

Empowering Deductors

-Centralized Processing Cell(TDS)

CPC (TDS) Re-engineering Outcomes Statement Corrections – Before CPC(TDS)

Challenges:

• Visiting TIN-FCs to submit correction statements • Payment of filing fee • Different taxpayers approaching deductors at different point of time leading to multiplicity of correction statements • Involved time, effort and money

CPC (TDS) Re-engineering Outcomes Online Statement Correction – After CPC(TDS)

Advantages : •

Intelligent and user friendly - Online Corrections

•

Any time Any where.

• Savings of cost, time and effort

CPC (TDS) Re-engineering Outcomes

Multiple Communication Channels Helpdesks

 Call Centre

Call Centre

 email  SMS

Email

IVR

Taxpayers  Online portal

Human Interface Only

 Postal

Online Portal

Text Direct Mail

Before CPC (TDS)

After CPC (TDS)

4 innovative practices at CPC(TDS) e- awareness drive -over 3.5 Crore educational and awareness emails sent to specific target group of deductors to sensitize them on the specific area of TDS compliance–special drive for better TDS compliance Alerting deductors to avoid defaults---identifying challan and PAN errors at preliminary stage of processing and providing one week window to resolve to avoid any TDS defaults; Step towards Non adversarial TDS administration

Institutionalized Constant Feedback process: Connecting back to 1000 deductors per week who raised grievances earlier to know their feedback on its resolution-over 70% satisfaction rate. “Callback” option on IVR: around 100 deductors per day are using this facility.

CPC (TDS) Awareness Programme

CPC (TDS) Awareness Programme (Contd.)

Corporate Connect 3,957 PANs

Pursuing 4000 PANs prompts compliance by 2 lac TANs

2,04,093 TANs

48% of total Deductee Row

81% of total PAN errors

• •

26% of total correction statements

35% of total tax deducted

18% of total filings

14% of total late filings

14% of total late filing fee

18% of total late payment interest

30% of total short payment

PANs with >=5 TANs has been considered The percentages are calculated taking total population as base

31% of total short deduction

39% of total late deduction

Corporate Connect Consolidated view of TDS defaults of TANs associated with a PAN available online on TRACES website Part G of 26AS Aggregated TAN compliance functionality MIS available to CIT(TDS)  Form 3CD ---Auditors may take note of it.

Towards better TDS administration From (2012)

Output

To (2015)

1

Time to intimate defaults to Deductors

Over 6 months of filing statement

Within one week of filing statement.

2

Timely filing of TDS statements

36% Statements

70% Statements

3

Timely deposit of TDS

50% Compliant

80.9% Compliant

4

Number of Non-PAN transactions

6.3%

3% (0.6% --Data entry errors)

3 of 17

Global Perspective

Uniqueness

Policy Formation

Replication

India – one of the pioneer countries for technology driven complete reconciliation of tax deducted at source and its claim by the taxpayers

Providing Insights for taking decision on DTAA

Bangladesh & Tanzania - eager to replicate our model Cenvat Department – in process of replicating

Moving from Legacy System to CPC(TDS) 3 Stages-Watertight compartments

Integration

Consolidation of end to end processes

Unorganized and Adhoc

Communication

Multiple channels

Limited Options, time and effort intensive

Corrections

User friendly:- Anytime anywhere

Mismatch -manual TDS certificates

TDS Matching

Unorganized Manual Process

Default Management

Accurate TDS matching

Technology Driven centralized processes 27

Feedback: Overall Satisfaction and Obligation Overall Satisfaction 2%

Meeting Obligations

2%

3% 24%

20%

2%

11% 29%

55% 52%

Extremely Satisfied

Very Satisfied

Dis-Satisfied

Very Dissatisfied

Somewhat Satisfied

Very Helpful

Helpful

Unhelpful

Very Unhelpful

Total Sample collected: 380942

Not much difference

Gold Award for TRACES -National Award for e-Governance 2014-15

CPC(TDS) – Way Forward  Online filing of TDS statements  Increase in scope of online services-197,challan correction

 Timely Grievance Resolution to the satisfaction of deductor-4 channels of communication (online grievance /email/call centre/postal letter)  26QB Correction (Recently rolled out)  Tax Payer grievance portal for TDS mismatch (recently rolled out)  Special focus on capacity building of stakeholders