TAX NEWS - 2010

Drive your way to Tax Benefits

It sounds weird but it's possible. Here is an idea principally based on car pooling system and then extended to maximize the benefits to each of the participant in car pooling ecosystem. This ecosystem will have various partners such as car owners who wish offer their cars for pooling, co-passengers who wish to join these cars for their daily commuting, the nodal agency, and various NGOs who are dedicated to their cause. The nodal agency will have to act as an integrator, keep & maintain the record of each partner in detail, keep tab on various aspects, and also work towards the enhancement of whole system for better experience.

Those car owners who will offer their cars for pooling network will get tax benefits which might be more than Rs. 30000/- a year. So how can you get it, let's discuss the Idea. Depend on car capacity, Car owners will have to offer his car for pool to as many as possible co-passengers who are traveling in same direction in which he himself travels to work.

Initially both Car owner & co-passenger will have to get registered on official website of Nodal agency & feel all the details required. Once all the desired details are filled then virtual account will be activated. Registration data will help to match pairs of car owners & car-passengers who are traveling in same direction.

Co-passengers will have to upload this virtual account with cash credits by paying actual money to the Nodal agency. Virtual account cash credit will exactly match to your money paid to Nodal agency. As a travel service charge for every drop, certain money will be debited from co-passengers virtual account and transferred to the virtual account of Car owner who has dropped the respective co-passenger.

Car owners will keep accumulating cash credits in their account for every pickup/drop service offered to various co-passengers. For every co-passengers' drop, car owner will get certain virtual cash credits which will be accumulated in his virtual account. These accumulated virtual cash credit will be transferred to NGOs who seeing funds for their fulfillment of social objective. Quarterly Nodal agency will then transfer actual money to these NGOs as per Car owner accumulated cash point. This actual money transfer will give car owner a certificate of donations from recipient NGO. Then car owner can use this donation certificate for tax rebate.

As a co-passenger you can upload your virtual account with cash credit points depending on your monthly need. Every Car owner can check day-to-day basis his accumulation of cash credits. And every co-passenger can check day-to-day debits from his accounts. This whole system will be similar to E-banking facilities.

It will be the responsibility of Nodal Agency to find out numerous dedicated NGOs who have fair financial track records and who are authorized to issue tax-exemption certificated to various donors. As per interest in social cause, Car owners' can choose NGO from available options. Once the Car owner select the NGO then every quarter his accumulated cash credits will be transferred to selected NGO as donation. For the accumulated cash points Nodal Agency transfer real money to selected NGO. Recipient NGO will issue donation certificate to Car owner for his donation. This donation certificate will then entitle him to tax exemption as per IT 80G section. The value of donation certificate will be the exact cash credits generated by car owner by offering car pool to various co-passengers during the quarter.

To make this system to see the light of the day, the Nodal Agency will have to act as an integrator. With advance online systems NG will have to synergize all the required operations. NA not only synergizing operations but also it will have to generate interest across all the car owners to join car pooling ecosystem and co-passengers who will join this. To make this ecosystem effective & successful, NG will have to find out perfect match of car owners & co-passenger who are staying in vicinity area & traveling in same direction.

By using advance online systems NG can easily integrate, synergize & manage whole system. Perfection till last mile actions will play crucial role in making this Idea a big success. The online system will have detailed record containing information on both the participants i.e. car owners and co-passenger. This online record will also have other vital information such as residential address, location of starting journey, starting time of morning journey, road which car owner take for day-to-day commuting, approximate time needed to commute till last destination, car type and maximum seat availability, pick up site, drop site, office timings, name & address of both the parties, evening time back home journey starting time, possibility of alternate arrangement/options for the evening back home journey, and possibly compatibility ratings of both participants highlighting does & don't for mutual benefits. To make this system secure and full proof, Nodal agency will also have conduct complete residential & office verification of both the participants.

It's not only a tax gain to you but it will also act generate cash to support various NGOs for their financial need. And at the same time it will benefit to those people who wish to travel in same direction in which you are going. Hopefully it might also generate employment for underprivileged class of our society.

Benefits from this Idea are much more than a just tax benefit to participating car owners and traveling ease for many co-passengers. Car owners just by doing simple adjustment in their every day's traveling pattern might help thousands of under privileged people in this city. To certain extent this will also help to decongest the traveling blues in the city. And if few Car owners come together do join car pooling of their own and travel office in one car it might help decongest road traffic as well. At the same this Car owners car pooling might earn some Carbon credits for saving petrol consumption. It will definitely help

Let's do some calculation on generation of fund for various NGO from this initiative. Even if we consider only 2000 Car owners & 4000 co-passengers will join for this system. For calculation purpose consider charge of Rs. 50 for one side journey.