E-Return Intermediary: Meaning, Registration, and Benefits

ERIs (E-Return Intermediary) act as a bridge between taxpayers and the Income Tax Department. An ERI can help you understand how to file ITR online and complete the process on your behalf.

What is an E-Return Intermediary?

An E-Return Intermediary (ERI) is an individual or entity authorized by the Income Tax Department to help taxpayers file their Income Tax Returns (ITRs) electronically. The main goal is to make ITR filing easy, accurate, and accessible to all.

The concept of ERIs was introduced to promote e-governance and increase voluntary tax compliance. These intermediaries are governed under Rule 12A of the Income Tax Rules, 1962.

Purpose and Importance of ERIs in Income Tax Filing

The digital transition in tax administration can be difficult for some users. Not everyone understands how to navigate online portals or keep up with tax law changes like TCS vs TDS, old tax regime vs new tax regime, or income reporting standards. ERIs provide trusted, trained support to ensure ITRs are filed accurately and timely.

They also help in:

• Avoiding penalties for late or incorrect filings.
  
• Explaining changes in tax laws.
  
• Offering extra services like stock market advisory and financial planning.

Who Can Become an E-Return Intermediary?

Eligibility Criteria for ERIs

To become an e-return intermediary income tax professional, you need to meet the eligibility criteria laid out by the Income Tax department. These include:

• Must be a resident Indian.
  
• Should be of sound mind and not declared insolvent or convicted for any offense involving fraud.
  
• Should have the required technical infrastructure like a secure internet connection, storage space, and software systems.
  
• Should have professional qualifications (like CA, CS, CMA, tax consultants, or advocates) or should be registered business entities providing financial services.

Authorized Entities for Registration

Entities allowed to register as ERIs include:

• Chartered Accountants (CAs)
  
• Company Secretaries
  
• Cost Accountants
  
• Tax Practitioners
  
• Lawyers specializing in tax laws
  
• Private firms or companies offering tax-filing solutions
  
• Non-profit organizations working in financial literacy

Some government-authorized platforms, such as NSDL and UTIITSL, and private players like ClearTax and TaxSpanner, operate as ERIs.

Functions and Role of an E-Return Intermediary

Assisting in Filing Income Tax Returns

The core function of an e-return intermediary is to assist taxpayers in how to file ITR online using authorized software or platforms linked to the Income Tax department. They collect required documents like PAN, Aadhaar, Form 16, investment proofs, etc., and fill in the details correctly before submitting the return.

They also:

• Advise clients on choosing the old tax regime or new regime.
  
• Calculate income, deductions, and tax payable.
  
• Generate ITR forms and file them on behalf of the taxpayer.

Providing Taxpayer Support and E-Verification Services

Once the return is filed, it must be verified using Aadhaar OTP, EVC (Electronic Verification Code), or sending a signed copy of ITR-V to CPC Bangalore. ERIs often provide e-verification services to ensure that the return process is complete.

Additionally, ERIs can help in:

• Filing revised returns.
  
• Rectifying errors.
  
• Responding to notices from the tax department.
  
• Uploading audit reports (if applicable).

Benefits of Using an E-Return Intermediary

Faster and Error-Free ITR Filing

Filing taxes can be confusing, especially with complex heads like capital gains, business income, or foreign assets. With an ERI’s help, errors are minimized, and the ITR is filed accurately.

ERIs also:

• Use authorized tax software that validates errors before submission.
  
• Ensure compliance with real-time Income Tax rules.
  
• Save time for salaried individuals and business professionals.

Professional Support for Taxpayers

Apart from tax filing, many ERIs offer personalized financial services such as:

• Investment planning
  
• Stock market advisory
  
• Guidance on selecting the correct tax regime
  
• Calculation of TCS vs TDS applicability
  
• Advising on deductions under 80C, 80D, etc.

For small business owners and professionals, ERIs often become long-term financial advisors.

Types of E-Return Intermediaries

Government Authorized vs Private ERIs

• Government-Authorized ERIs: These include official bodies such as NSDL, UTIITSL, or authorized PAN centers. Their services are regulated, often low-cost, and offer basic return filing.
  
• Private ERIs: These include fintech companies or tax platforms like ClearTax, Tax2Win, etc., which provide more comprehensive services, ranging from income tax filing to financial advice.

Individual Practitioners vs Corporate ERIs

• Individual ERIs: Chartered Accountants or tax consultants operating independently, often offering personalized support.
  
• Corporate ERIs: Registered companies with large infrastructure, offering software-based tax services, e-filing solutions, and automated processes for hundreds or thousands of clients.

How to Register as an E-Return Intermediary?

Step-by-Step Registration Process

Here’s a simple guide on how to register as an e-return intermediary:

1. Visit the Income Tax e-filing portal: Go to https://incometax.gov.in
   
2. Login or Register as a new user.
   
3. Go to My Account > Register as ERI.
   
4. Fill in required personal or business details.
   
5. Upload supporting documents (covered below).
   
6. Choose the software you will use for e-filing.
   
7. Submit the application.

The Income Tax department will verify your application and activate ERI credentials once approved.

Documents Required for ERI Registration

• PAN and Aadhaar (for individuals)
  
• Registration Certificate (for companies or firms)
  
• Address proof
  
• Copy of professional qualification (CA, CS, etc.)
  
• Undertaking to follow data security and confidentiality standards
  
• Agreement with software providers (if using third-party platforms)

Responsibilities and Compliance Requirements for ERIs

Maintaining Data Security and Privacy

ERIs are required to ensure that all taxpayer information is kept confidential and safe. They must:

• Use encrypted software for data storage.
  
• Restrict access to client data.
  
• Ensure that only authorized personnel handle tax filings.

This is particularly important with sensitive documents like Form 16, PAN, Aadhaar, and bank statements being shared.

Following Guidelines Issued by the Income Tax Department

ERIs must stay updated with all rules, circulars, and technical updates issued by the department. For instance, recent changes like:

• Digital signature mandates for certain taxpayers.
  
• New forms introduced in the Budget.
  
• Integration with Faceless Assessment systems.

Failure to comply can result in deactivation of ERI status or penalties.

Fees and Charges for E-Return Intermediary Services

Government Norms on Pricing

The government does not fix pricing for ERI services, except in the case of some government platforms that offer free or low-cost filing. However, guidelines suggest ERIs should offer fair, transparent pricing.

Typical Service Charges by Private ERIs

Charges vary based on:

• Type of income (salaried vs business)
  
• Volume of transactions
  
• Complexity (like capital gains, foreign income, etc.)

On average:

• Salaried ITR: ₹300 to ₹1000
  
• Business ITR: ₹1500 to ₹5000
  
• NRI ITRs or ITR with capital gains: ₹2000 and above
  
• Add-ons like investment reports or stock market advisory may be extra

Recent Updates Related to E-Return Intermediaries

New Compliance Rules and Technological Integrations

• The Income Tax Department has updated its systems to improve security for ERIs, including mandatory two-factor authentication.
  
• New tools allow real-time error checks while filing ITRs.
  
• Artificial Intelligence is being integrated for risk scoring and faster processing of returns.

Impact of Faceless Assessment on ERIs

The faceless assessment scheme has created more opportunities for ERIs to act as authorized representatives for taxpayers. ERIs can now:

• Help clients draft responses to faceless queries.
  
• Assist in submission of e-proceedings.
  
• Support clients in understanding demand notices or rectification orders.

Conclusion

An e-return intermediary bridges the gap between taxpayers and the Income Tax department, making return filing a stress-free task.

By offering support on how to file ITR online, assistance with e-verification, handling revised returns, or even providing stock market advisory services, ERIs make taxation easier for millions of Indians.

FAQs

Is it mandatory to file through an E-Return Intermediary?

No, it is not mandatory. Individuals can file their own ITRs via the official Income Tax e-filing portal. However, using an ERI helps reduce errors and saves time.

How do I verify if an ERI is authorized?

Visit the Income Tax e-filing portal and go to the “List of ERIs” section. You can search using the ERI’s name, registration number, or PAN to confirm if they are officially recognized.

Can ERIs help in filing revised returns?

Yes, ERIs can assist in filing revised returns, rectifying mistakes, or responding to tax department notices. They also help in ensuring compliance with changes in TCS vs TDS, or transitions between tax regimes.

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