E-Return Intermediary (ERI) Income Tax: Meaning, Registration, Eligibility, Benefits, List

From filing paper-based returns to this era of digital filings, return filing has transformed steadily over the last few decades. The onset of technology has brought significant changes in filing and the complexity of tax laws, leading to the emergence of e-return intermediaries. Those authorized individuals who help taxpayers in successfully filing their income tax returns are called e-Return Intermediaries. An e-return intermediary simplifies the complexities of tax compliance. It ensures that taxpayers can efficiently and seamlessly navigate the process. 

This blog will help you familiarise yourself with what an e-return intermediary is, its benefits and prerequisites, a list of ERI income tax, eligibility criteria, registration process, roles and responsibilities, and other relevant information.

So, let's get started!

Who are E-Return Intermediaries?

Let's begin our understanding of ERI by understanding the meaning of e-return Intermediary.

E-Return Intermediaries are certified professionals authorized to file income tax returns on behalf of taxpayers. The taxpayers can submit their income tax returns electronically or via an intermediary or a liaison.

The Income Tax Department appoints these officials to file income tax returns on behalf of taxpayers. To qualify as an e-return intermediary, a set of eligibility criteria must be followed. Individuals aspiring to work as ERIs in the income tax department must register online with the NSDL if they fulfil the eligibility criteria set by the ITR.

Since we understand the meaning of e-return Intermediary, let's review its roles and responsibilities.

Role and Responsibilities of E-Return Intermediary

Here are the key roles and responsibilities of an ERI in income tax:

• To evaluate the taxpayer's eligibility to use the scheme.
• To verify the legitimacy of the taxpayer's PAN and TAN.
• Double-check the information provided in the documents submitted with TDS, advance tax, and self-assessment tax details.
• To ascertain that the taxpayer has entered authentic information in the income tax return form.
• To ascertain that the ITR is filed online within the stipulated time.
• To confirm that the taxpayer has verified the ITR.
• To check that the data pertinent to ITR filing is stored for at least one year after the termination of the assessment year.
• To ascertain that the taxpayer gets the acknowledgement of the ITR-V form and a copy of the e-return.
• To guarantee the privacy of the client's data.
• Check that the officials working under the ERI intermediary adhere to all the stated conditions, provisions, and rules.
• To confirm any changes in the data of the application sent are informed to the registrar. 

E-Return Intermediary Eligibility Criteria

The entities are allowed to become an e-Return intermediary if they meet the following e-return intermediary eligibility criteria:

Note: The following entities must have a valid PAN

• A company/public sector organization, Advocate, Company Secretary, or a Chartered accountant
• A company having a net worth of more than ₹1 crore and is registered in India
• An organization of Chartered Accountants
• A firm of advocates
• A firm of company secretaries
• An individual authorised to prepare tax returns
• A government department drawing officer
• A cost accountant
• A firm of Cost Accountants

Prerequisites of E-Return Intermediaries

To apply and join the e-Return intermediary list, the entity must fulfil the following prerequisites:

A Class II or III Digital Signature Certificate obtained via a licensed NSDL-certified certifying authority. It is necessary to digitally authorize and sign the uploaded online returns and the submitted application. The applicant's name must be mentioned in the certificate. The applicant must submit an authorized letter if the certificate is issued in an employee's name/partner's name.

Hardware Requirements

The entity must have the necessary hardware, as mentioned below:

• A CPU operating at over 500 MHz
• Minimum 256 MB RAM
• An 800 x 600 pixel screen resolution and a 256 colour display monitor
• Dedicated storage space of at least 20 GB (on the hard drive)
• A DAT drive/CD writer or other device useful for backup
• A UPS for backup power for minimum 30 minutes
• A printer

Software Requirements

The entity must meet the following software requirements:

• An operating system of Windows 98 or above
• Reliable anti-virus software
• An internet connection of sufficient speed
• A browser with version higher than IE 6.0
• A due diligence certificate obtained from a certified ISA or CISA professional must be submitted
• The entity must use a computer system that only has programs permitted by the Income Tax Department. All the necessary procedures must be followed to ensure data security
• No criminal record

The e-return intermediary registration must be completed before starting to provide these services.

E-Return Intermediary Registration

An E-Return Intermediary must consider the following aspects for the e-return intermediary registration:

• Any eligible entity can register with the NSDL by submitting the registration form online. Applications cannot be submitted offline.
• If the application is verified for registration, the applicant will be navigated to a screen that shows a unique 15-digit acknowledgement number. The entity must download, save, and print the acknowledgement receipt for future reference.
• The entity needs to sign the acknowledgement. The signed acknowledgement needs to be sent to the NSDL with the below documents attached:
  • Certificate of Due Diligence
  • Eligibility proof
  • PAN or TAN card, according to the disposition of the entity
  • The entity needs to pay a registration fee of ₹4,000

How to Become an E-Return Intermediary?

An entity can follow the below steps to become an ERI in income tax:

1) Check eligibility criteria:

• Having a valid and active PAN
• Not already registered as an e-Return Intermediary
• Having the recommended computing infrastructure 

2) Select ERI type:

The entity must determine whether it needs to register as Type 1, Type 2, or Type 3 ERI. Each has unique requirements for offline tools and software applications. 

3) Register:

Register online on the official e-Filing portal. The entity must fill out the registration form, enter TAN/PAN and submit the necessary documents. 

4) Submit documents:

The entity needs to submit a due diligence certificate from a licensed CISA or ISA professional and proof of eligibility. The registration processing fee should also be paid. 

5) Wait for Approval:

The authorities will review the application. If it gets approved, the entity will get a confirmation and can begin working as an ERI. 

How to Renew e-Return Intermediary?

Follow the below steps to renew e-Return intermediary registration: 

Step-1: Open the e-Filing portal homepage and click "Register".

Step 2: Go to the "Others" tab and choose "e-Return Intermediary" from the Category dropdown.

Step 3: Choose "Register as New Applicant" and choose a suitable ERI type. Click on "Continue".

Step-4: Within the "Register as e-Return Intermediary page," enter your TAN / PAN through which you wish to register as ERI and click "Validate".

Step-5: Once validated, a 6-digit OTP will be shared on your registered mobile number of the mentioned TAN / PAN. Fill in the OTP and click on "Continue".

Step 6: Choose a suitable applicant category and click "Continue".

Step 7: Fill in the basic details and click "Continue". (The basic information includes name, DOB, name of organization, DOI for company, and date of allotment of TAN for DDO)

Step-8: After successful validation, the Principal Contact Details page will open. Fill in the contact details of the Principal contact and click on “Continue”.

Step-9: A 6-digit OTP will be delivered to the email ID and mobile number. Enter the OTP and click on “Continue” 

Step-10: Open the Attachments tab and then upload documents as per the applicant category. 

Step-11: You may need to edit the details (if needed) in the Verify Your Details page and click “Confirm”.

Step-12: Finally, the screen shows a success message and the registration request is sent for approval. 

Benefits of Becoming e-Return Intermediary

Taxpayers can obtain several e-return intermediary benefits if they electronically file their taxes via an e-Return intermediary. The benefits are:

• The e-filing process through an intermediary is quick and convenient.
• If the taxpayer meets the eligibility criteria, they can obtain tax refunds within 1-2 months if they have filed their returns via an E-Return Intermediary.
• All information submitted by the taxpayer via an E-Return Intermediary stays confidential and secure.
• The filing process through ERI limits the chances of errors. The ERI system instantly displays wrong data and informs the user to fill in the accurate information.

E-Return Intermediary List

There are 50+ ERIs. The following e-return intermediary list shows some of them.

• Corwhite Solutions Private Limited
• MDA Softwares Ltd.
• ETAXWAY SERVICES LIMITED
• WINMAN SOFTWARE PRIVATE LIMITED
• QIMAT RAI GARG
• Clearsharp Technology Private Limited
• Verve Financial Services Private Limited