What are the benefits of filing income tax returns?
Most of the present generation adults, always have one question in their mind that is “ What are the benefits of filing income tax returns.” Now, If you are one of them then don’t worry we got you covered.
Usually, Life as a businessman can always seem glamorous until and unless they pay the income tax returns on time. If not they will always lead their life facing fear factors. I am saying this because this is a fact.
Filing ITR is a sign of responsibility you have towards society. Here “ITR” means an income tax return and it is nothing but the tax form which used to file income tax with the income tax department.
Now, as you are searching for the benefits of filing income tax return. We are quickly going into the benefits of ITR.
Benefits of filing income tax returns:
Here in this article, I am going to provide all the best benefits of filing income tax returns on time. Even though the filing of income tax is not required for some people but still there are some best benefits they can avail when they do file the income tax returns.
Easy loan Approval:
People at some stage in their lifetime think about lending money from banks either for their personal needs or to purchase something. At that point of time, the income tax receipts will help them to get their desired loan amount.
That’s why having income tax filed will help any individuals. When they have to apply personal loan, vehicle loan, or even for home loads. In fact, when applying all major banks do ask for a copy of tax returns.
To Easily Claim Tax Refund:
Filing income tax is helpful to claim a tax refund. In case, if you have a refund due from the income tax department means you need to submit the income tax return to request the refund from the income tax department directly.
Usually, most of the taxpayers mainly invest through the fixed deposit. On such fixed deposit investments, the tax is deducted at the source itself, and they will deduct 10percent.
If at all your individual total taxable income is less than Rs2.50 lakhs per annum?
Then you can claim a full refund. This all can happen through a filing income tax return.
Quick Visa Processing:
If you want to travel abroad, visa processing is the primary and essential step. Now, to get through that step, you have to produce your tax returns for at least the past couple of years at the time of visa processing.
Most of the embassies always do ask to give past two years ITR receipts, but some embassies also ask past three years ITR receipts at the time of Visa Interview. Usually producing proper ITR receipts always help them to check the source of income you get and it strengthens your visa processing, and it will make your visa process much more comfortable.
If you file your income tax report on time means you will avoid penalties or else you have to pay more in the form of penalties. For the year 2017 -2018, Government has imposed a penalty of Rs 5000 rs. Apart from that, the black mark will remain for others years to come. So, you have to pay your tax on time to avoid unnecessary penalties.
Credit Card Processing:
If you are thinking to get a credit card means you have to file income tax return because banks can reject your credit card application if you don’t file your income tax.
For purchasing a high life cover:
If you are planning to buy life cover or insurance of more higher amounts such as Rs 50 lakhs or Rs 1 Crore etc. you have to submit your ITR documents to verify your annual income simply. Most of the life insurance companies ask for ITR these days for policies which exceed 50 lakhs.
Used as Income & address proof:
Like other address proofs, you can also use income tax receipt as an address proof. The income tax return receipt which is sent to your registered address can act as both income and address proof as well because it does have all the information.
To compensate losses and carry forward them to the next financial year:
Unless and until you file an income tax return you cant carry forward your losses. As per the rules of income tax department if a tax return is not recorded on time or unadjusted losses with some expectation cant be carried forward to the future years. So, you have to be careful while showing losses and also you have to be quick in filing income tax return. In general, a long-term loss in a year can be carry forwarded for eight consecutive years.
Income tax Receipt helps to cut off interest:
In most cases, if you don’t file your Income tax return, then the belated return could charge extra interest of 1% per month for all the remaining taxes you are paying. Ex: Banks will deduct tax from your fixed deposit if it exceeds the threshold amount. To avoid that you have to have tax receipt.
Income tax Receipt is an Important Document in one’s life:
Just like the Aadhaar card, and other proofs having an Income tax receipt is essential to lead the life much easier. It is one of the important document which is having more details than the form 16. This receipt will have your income and taxation along with the revenue you generate from other sources as well.
Helpful in getting Government tender:
If you plan to start a business or take government tenders?
Then you have to show your tax return receipts of the previous three to five years. This is helpful to know the financial status of you, and it also helps you in getting government tenders. However, this is not a strict rule, but it always depends on the internal regulations of the government.
Helpful for freelances and independent professionals:
If you are a freelancer or self-employed professional, then you don’t have form 16. So, the only document you have with you is ITR. It is helpful to show the funding and also resolves the funding and transaction issues.
Now, these are benefits of filing income tax returns.
This is all about the topic ” what are the benefits of filing tax returns”.
If you are planning to file your income tax returns after reading these benefits, then you should do that. what do you think about these benefits? let us know in comments section.