Getting a tax Clearance Certificate was important in the past because this certificate is useful for transactions. This certificate is necessary during bidding on government projects, real estate registration, postage, or shipping license. Later, these are abandoned, and taxpayers can include Permanent Account Number documents. The below article has details about the process of how to get this clearance certificate.
- 1 What is a Tax Clearance Certificate?
What is a Tax Clearance Certificate?
A Tax Clearance Certificate is a statement given to the taxpayer that they cleared all the outstanding taxes, and they are not responsible for paying any tax. Taxpayers get this certificate after careful verification from Tax authorities. The Revenue Department of the State government issues this certificate once the tax obligations get clear.
According to the rules, various taxes, like income tax, sales tax, use tax, unemployment tax, etc., includes in this clearance certificate. Once the tax officer is fine with the documents, they will issue the ITCC for 30B. This form has all the details regarding the tax and its clearance. You can get other information about the certificate by reading this article.
Who and When does a Tax Clearance Certificate is needed?
As per the rules of the Indian Government, every Indian citizen who is employed, owns a business, or has another source of income from India has to pay tax. All those taxpayers need to get the Tax Clearance Certificate before departing the country or returning to the country. This also applies to foreign nationals who have a business in India and need this certificate before returning to their country.
When to get the Clearance Certificate:
If a person departs the country and meets the following three conditions, they must get this certificate.
- If the person is not a citizen of India.
- The person travelled to India for business or other work-related.
- If they receive income from India in any way.
There is no need for an Indian Citizen to take this certificate from the government. But getting it is necessary if they are suspects of any illegal activity.
Income tax certificate importance:
An Income tax return is an important document for citizens to show their income. This document is mandatory for loans, land registration, credit card, etc. Even if you are not eligible, filing the IT return document is advisable. This document gives all the information about your income in a particular financial year. This is legal proof of all the taxes that you paid.
How to get the Income Tax Clearance Certificate?
The Government of India doesn’t provide online services to file an Income Tax Clearance Certificate. You must visit the state’s Tax Department to file for this certificate. The taxpayer must submit an undertaking from their employer to the tax department. To file this certificate, the applicant has to file a proclamation from the employer or from where they get their income.
While filing the clearance certificate to the tax officer, a non-domiciled person has to submit Form 30B from their respective employer. This form has to state that the individual’s employer is responsible for the payable tax after their departure. After receiving the undertaking, the tax officer issues the ITCC on form 30B.
What happens if the Income Tax Clearance Certificate still needs to be submitted?
Suppose the taxpayer needs to submit the Income Tax Clearance Certificate. In that case, the responsibility falls on the carriage owner, i.e., aircraft or ships. The owner has to pay the passenger’s tax. If the owner doesn’t pay the passenger’s outstanding tax, it falls as an arrear, and he has to pay it in the future.
The taxpayer must take an Income Tax Clearance Certificate if they depart or return to the country. The Government Revenue Department issues the certificate after verifying all the details. There is no online process to get this certificate. You can get this certificate from the Tax officer after filing for the certificate.
This certificate is a legal document that shows that the individual pays all the taxes.
A non-resident who came to India for business, work, or any activity has to get this certificate before departing the country.
There is no online process or portal to apply for this certificate. To get the ITCC, you have to visit the tax officer.
The Income Tax Return document gives information on an individual’s income for a specific financial year.