The funding will be used by the three year old start-up to accelerate its growth and for product development.
Span Across IT Solutions Pvt Ltd, which runs an online tax filing service, TaxSpanner.com, has raised an undisclosed amount of funding from Indian Angel Network (IAN). The funding by IAN - for a "significant stake" - will be used by the three year old start-up to accelerate its growth and for product development. This is the first round of external funding by the Delhi-based startup.
The tax filing space has already seen some funding action in the past. BCCL has backed First Altus Resources and Networks (Taxshax.com) in an ad-for-equity deal. Accel and Mumbai Angels have funded Fin-e-ssential Infotech India Ltd.(Vegayan), which provides HR and payroll services besides tax filing.
"There are plenty of firms in this segment who have come to us for funding. There is a model that companies are following that after they get the personal details, they start pushing other products like insurance, home loans, etc. There are no leakages with Taxspanner and a strict policy on data privacy," said Sunil Kalra, a member of IAN who has invested in TaxSpanner.
"IAN is going to overemphasise on the privacy matter and ensure that the company achieves the highest governance standard," said Sanjay Bansal, an investment banker and another IAN member who has invested in the firm.
Also, TaxSpanner is focusing on getting corporate clientele besides the retail consumers. It has tied up with more than 100 companies with clients like HCL Technologies, Accenture, among others. TaxSpanner also has clients like Citibank and Punjab National Bank, who use its services for their customers. The company now has around 200,000 unique users from hundreds of large employers in India.
While TaxSpanner charges from Rs 249 to Rs 749 for its products to retail customer, charges for corporate customers vary.
Sharma adds that there are 30-35 million tax returns filed every year, around half of which are filed by salaried professionals. He adds that the number of filings are expected to increase by 2-3 times in the next couple of years due to factors like changes in tax administration, upcoming direct tax code, increased focus on UID and the investment by the government on the technology framework for taxation. Close to 10-12 lakh salary income tax returns are e-filed currently.
"The Indian government has taken the approach of lowering the tax rates but increasing the base to still achieve more than 20% year-on-year growth in tax collection. The government is clearly taking the strategy of increasing its reach which is feasible only with scalable solutions like TaxSpanner," said Priyank Garg, another IAN member who has invested in the firm.
TaxSpanner currently has offices in New Delhi and Bangalore, with associate offices in cities like Mumbai, Chennai, Pune, Hyderabad and Kolkata.
With this deal, Kalra and Garg of IAN will join TaxSpanner's board.
TaxSpanner is the product from Span Across IT Solutions Private Limited.
Span Across's mission is to streamline the service delivery process in income tax return preparation and filing space by minimizing human interface, providing definitive products based on current laws, providing highest quality customer support and an enjoyable user experience.
The founders of Span Across have a unique and extensive domain expertise in the field of software based solutions development, income tax and financial consulting
This is a press release