Zomato had launched a new facility where its delivery partners could file ITR through the Zomato partner app and hence could reclaim the 1 percent TDS, which was deducted on their earnings.
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The company announced that over 100,000 riders started filing their ITR in just 48 hours on the app, Zomato cofounder Deepinder Goyal said in a post on X. According to Goyal, Zomato paid more than Rs 4,000 crore to its delivery partners last year, for which it paid around Rs 40 crore as TDS. He added that all delivery partners whose income was below the taxable limit would get refunds, thereby helping most of them.
Last year, the government brought in a policy that asked companies like Zomato and Swiggy to deduct 1 per cent TDS from the payments made to delivery partners. “This will make many of our delivery partners file taxes for the first time, making their life easier in the long term. They will get access to structured credit and be eligible for scholarships for their children among other things,” he said, citing the initiative.
Facilitating ITR filing for Zomato’s riders could become a huge development for both the gig economy and the government by not only making delivery partners access formal credit but also adding to the state’s exchequer through TDS collection. Experts feel that this trend will prompt more firms to adopt the TDS collection system that, in turn, shall add to state revenues.
This comes at a time when the market capitalization of Zomato had crossed Rs 2 lakh crore on the back of a record rise in share prices which pushed Deepinder Goyal into the billionaire club.
In another development, Zomato has received a demand notice from Karnataka regarding a GST of Rs 5 crore, interest of Rs 3.93 crore and penalties of Rs 50.2 lakh. Zomato is contesting the order in front of the appropriate authority.
ITR filing through the Zomato app will, therefore, go a long way to bring better financial well-being to its delivery partners by providing them with greater financial stability and access to a range of benefits that were otherwise inaccessible. It thus underlines Zomato’s concern for the deliverers’ lives while bringing itself in line with regulatory requirements.
By simplifying the mechanism of tax filing and returns for the delivery partners, Zomato is making sure to build a financially sound delivery force, enforcing compliance with tax laws, and setting benchmarks for others in the gig economy.
