Every day, you contribute to the nation’s development, often without even realising it. From your morning tea to your evening commute, many of your purchases include taxes like GST. While this makes every consumer an indirect taxpayer, being a taxpayer in the formal sense involves more than just paying for goods and services.
If you earn an income or operate a business, you are required to pay taxes directly to the government. But what does that really mean? In this article, we break down who qualifies as a taxpayer, their duties, rights, and how you can fulfill your tax obligations seamlessly.
Who is a Taxpayer?
In India, a taxpayer is any person or entity—such as an individual, firm, or corporation—that pays taxes under the Income Tax Act, 1961. These taxes are levied based on the income earned during a financial year.
There are two primary types of taxpayers:
Individuals, including salaried employees and freelancers
Entities, including companies, LLPs, and partnership firms
You may also pay taxes to either the Central or State Government. For instance:
Income Tax and GST: Collected by the Central Government
Taxes on petroleum products and liquor: Levied by State Governments
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