Filing of Income Tax Return involves the filing of the statement of your earnings and expenses/liabilities/losses and tax. The tax has to be submitted under various forms such as ITR1, ITR2, ITR3, ITR 4, ITR 5, ITR 6 and ITR 7 either online/offline to the Income Tax Department under the Income Tax Act, 1961 and Income Tax Rules, 1962.
These income tax returns need to be submitted at the end of every financial year as per the nature and amount of our income. Non-filing of income tax return attracts interest, penalty, prosecution, and scrutiny – all of them at a time, or on a case by case basis from the Income tax department.
Therefore, it is better for filing income tax returns before the specified due date. Every Income Tax Return form is applicable to a certain section of assessees.
Filing of Income Tax Return is beneficial in many ways. Let’s find out some of these benefits:-
· Sooner You File the Faster You Get Your Refund
Filing of income tax is like ripping off a bandage and therefore it is important to be quick and save you the pain from penalties. In addition, you will get any refund that you deserve after paying your taxes in tandem as per the income tax provisions.
· Getting Eligibility for All Loan Applications from Banks
In order to grant you the loans, banks need to know about your financial capability and capacity to repay the loans. The income details as shown by you in income tax returns would help the banks in making a final decision to provide you loans as per your requirements. Filing an income tax return for the last three years would help you in submitting them to your bank for the concerned loan requirement.
· For Various Appointments in Judicial and Class One Jobs
In case you are applying for judicial jobs or you are a prospective candidate for Class-I jobs such as for Chartered Accountant, Lawyer there is a need to provide annual professional income at the time of appointment in the form of the post income tax return. In such case, the sooner you file your income tax return the sooner you can show your credibility regarding your income records.
· Helps You Effective Tax Planning
Filing the income tax returns helps you in tax planning as the income tax act provides a long list of items for which you can claim tax deductions. An effective tax planning begins with the choice of the most rewarding categories of deductions thereby helping you in showing your real income status to the bankers or any other institutions requiring a copy of your income tax returns.
· For Immigration Purpose as Part of Obtaining Visa Outside India
The pain of getting a visa will diminish if you provide your income tax return to host country high commissions where you want to travel or settle in. Immigration officers give due prominence to those people who show their genuine source of income through their income tax return.
With the encouragement from the government by bringing in extensive tax reforms and measures to incentivize the disclosure and reporting process more and more people would voluntarily come forward to file income tax returns. Don’t miss this opportunity to grab all the benefits associated with income tax return filing.