CPC income tax: Meaning, importance, and the computerised process

Any income tax return filed by a taxpayer will be processed online at the CPC, which is known as the Centralised Processing Center. When the tax refund details are processed entirely, the ITD or the Income Tax Department will issue their decision. If there is any refund, the taxpayer will get the information in accordance with Article 143 (1). Here you will understand the detailed process of CPC income tax.

 

CPC income tax: What is the CPC?

The tax return is filed voluntarily under section 139. Also, it can be made by the request of the Income Tax Department under section 142 (1). So, it is always important to know the other processes right after filing a tax return. The whole system of reviewing the income tax return filed by a taxpayer to the income tax department is known as an assessment. The IT department will go for a primary review of all the returns, and then the department will inform the taxpayer whether there is any refund or not.

This primary assessment includes all kinds of arithmetical errors, tax calculations, payment verification, inconsistencies, etc. This entire process is computerised, and the Central Processing Center or CPC does it.

 

CPC income tax: Why is the CPC important? 

As the number of tax refunds is increasing rapidly, the tax department faces many issues that need to be addressed in the income tax refund process.

After seeing this issue, the Finance Act of 2008 started the Central Board of Direct Taxes to create a centralised returns process. The rules of centralised processing come from the Income Tax department. The technical advisory group of the tax department has stated that CPC Bangalore will go for the detailed processing of the tax returns without any interface with taxpayers and in a jurisdiction-free manner.

This CPC process is quite beneficial to taxpayers and the Income Tax Department. After the initiation of the CPC, taxpayers can get an easy and fast result for their tax refund declaration. The income tax department has experienced less burden of pre-assessment. Also, the computerised process has helped by checking any errors effectively.

 

CPC income tax: Process

The whole primary report processing is automated, and the CPC notification is also a computer-generated record of the process. The CPC helps validate all the data provided in every tax return with the detailed data available in the taxpayer’s file.

• After the tax return is filed, the automated process again calculates the total income or loss. It creates a comparison between the data provided by the taxpayer.
• This intimation provided by the CPC has two different columns: “As provided by the taxpayer in the income return” and “as computed under Section 143 (1).
• The comparison shows whether any difference is there in income, total gross income, deduction, etc.
• Proper adjustments are then prepared so that the amount can be found.
• The adjustment is carried out when the intimation is sent to the taxpayer.
• Only when the taxpayer sends the response within 30 days from the issuance date of intimation will the final adjustment be done by the CPC.
• The intimation may be different from one taxpayer to another. The types of intimations are:
  • Intimation with no demand or no refund
  • Intimation determining demand
  • Intimation determining refund
• When the demand notice is received from the taxpayer’s side, the refund will be sent to the taxpayer.

 

FAQs

How can I contact the CPC Income Tax?

You can contact the CPC via these numbers: 1800 103 0025, 1800 419 0025, +91-80-46122000, and +91-80-61464700.

What is known as the CPC intimation under section 143(1)?

The intimation by CPC is a notice sent to taxpayers after processing their ITRs.

How much time does it need for the CPC to process ITR?

Usually, it takes 20 to 45 days after ITR has been processed for the CPC to process the tax return.

What is intimation u/s 143(3)?

The intimation under section 143(3) is a thorough examination and is referred to as a scrutiny assessment.