Large Taxpayer Unit
A Large Taxpayer Unit (LTU) is a self-contained tax administration office under the Department of Revenue. It acts as a single window clearance point for all matters relating to central excise, income tax/corporate tax and service tax.
Entities would be able to file their excise return, direct taxes returns and service tax return at such LTUs and assessment for all these taxes would take place at such LTUs. It has been equipped with modern facilities and trained manpower to assist the tax payers in all relevant matters.
It aims at reducing tax compliance cost and delays, and bringing about uniformity in the matters of tax/duty determination.
How are LTUs established?
- The first LTU was established at Bangalore in 2006, followed by three more in Chennai, Mumbai and Delhi
- Each LTU is headed by a Chief Commissioner.
- There are also Commissioners holding executive and appellate charges
- A Client Executive is appointed for each taxpayer, who is the single point interface with the large taxpayer for all purposes.
- The Officers posted in LTU have all India jurisdiction in respect of all registered premises of a large taxpayer registered in that particular LTU.
- It performs all the statutory functions presently mandated under the income Tax Act, Wealth Tax Act, Central Excise Act, Customs Act, Finance Tax and Service Tax Rules.
How do they help?
An LTU entails the following advantages to the assessee who has registered under it:
- Filing of documents at a single place. A large taxpayer can file all his taxes, direct as well as indirect with an LTU.
- Single point interaction at senior level for assistance in any/all tax matters made available. This ensures that the taxpayer need not interact with different section/officers of the LTU.
- The erstwhile jurisdictional field officer neither suo motuvisit the units nor interact with the taxpayer for any issue, once the taxpayer has joined the LTU.
- The taxpayer has the option to transfer any excess CENVAT credit (of central excise duty or service tax) accumulated in one manufacturing unit or service providing unit to any other eligible unit of his choice through a simple mechanism.
- Movement of capital and finished goods without duty reversal is allowed. This means that an LTU taxpayer has the facility of removing capital goods and inputs or finished goods from one unit to any other unit of its choice, without payment of duty/reversal of credit through a simple method.
- The taxpayer is not subjected to mandatory audit. The selection of a taxpayer for audit is based on – risk assessment. The Department ensures that audit schedulers are drawn in consultation with the taxpayers so as to cause minimum inconvenience.
- It is ensured that there is uniformity in the practice as regards classification, valuation, credit availment and similar other issues, for various units of a taxpayer.
- The rebate/refund claims would be disposed off in a time bound manner within 30 days, if the claims filed are in order.
- Use of Automation: Returns can be filed electronically and payment of taxes also can be made electronically. Greater use of e-mail for communication is encouraged.
- Interactive approach is adopted for dispute settlement. Before a show cause notice is issued, the matter under dispute is discussed for a resolution, if possible.