HYDERABAD: A new financial services sector is mushrooming in the city, thanks to the introduction of Goods and Services Tax. These are companies set up to help traders get acquainted with the new tax regime and file their returns. The booming business has even attracted freelancers into the fray.
Telangana has 2.10 lakh registered VAT traders eligible to migrate to GST. So far, 2 lakh have already moved to the new regime. Apart from this, another 43,000 new traders who were not a part of the VAT regime are to be brought into the new tax ambit by the commercial tax department. The department had even gone on a registration drive across the state holding camps at 60 centres to create awareness.
Krishna Moorthy (name changed) has put up flyers across Ameerpet. Though he works as an accountant with a private firm, he does GST registration and filing of tax returns for small traders by the side. He charges them a fee of Rs 2,000 to Rs 3,000 per sitting. “At some point, everyone is going to register and those who are starting a new business will register by themselves. But small traders who are uneducated will need help filing tax returns.
I don’t think its necessary to start a company for this,” says Krishna Moorthy.
The 29-year-old started out helping his uncle file tax return and has been roped in by others through referral. He is yet to receive any freelance work through the flyers he had put up. The financial services firms, set up solely for traders migrating to GST work on contract basis, charge Rs 9,000 per annum for small traders and Rs 40,000 per annum for bigger ones.
“We are in contact with close to 130 traders, this is few because not everybody needs GST registration,” said Akhil Chandra, director of Akshara Finserv private limited, Amberpet. The firm is only a few months old.“Most traders are averse to change and we assure them that GST is nothing to be afraid of, we make them comfortable with the rules and regulations. Unlike the Value Added Tax (VAT) system, in GST all traders are to keep a record of all invoices. This means they have to get a computer. Even traders who earn below Rs 20 lakh are migrating to GST so as to not lose out on inter-state business. We help them with registration, compliance and filing monthly tax returns,” he added.