Question

I am having a little difficulty understanding how E&P applies to the tax law and where it is used on the tax return. I read that E&P has been included in the tax code since 1916, but if it includes income that is typically nontaxable, what is it used to calculate in the tax return?  

Answer 1

An ERP will be useful in the following ways:

- to reduce the complexity of tax calculations.

- to minimise the time spent on tax compliance.

- improved accuracy is achieved.

- security of data can be ensured.

- it automatically reminds the tax due dates and there by it enables timely filing of returns and finally reduce the tax penalties.

- facilitates easy online tax payable methods and ensures secured paypal gateway.

- easy data sharing for authenticated users and helpful in preparation of reports as required.

For example, in the slaes tax returns ERP will be useful as follows-

- for jurisdictional assignment using the geolocation to determine address and validity so that correct sales tax is being collected if it needs to be collected based on ZIP codes.

- using an integrated tax solution, it keeps continuous trace on changes in tax rates and laws which reduces the risk of error and related audit and penalties.

- it allows us to track transactions that require remittance of tax and hence making the process more efficient and accurate.