Income Tax Return is a document an individual is required to file with the Income Tax Department on a yearly basis. However, it is not mandatory for everyone to file the Return. If your income in the previous year is above the basic exemption limit of INR 2,50,000 (Rupees Two Lakh Fifty Thousand only), then you are required to file the Income Tax Return compulsorily.
Even though it is not mandatory for some persons to file the Income Tax Return, one should file it every year as there are many benefits of filing it.
Here are some of the major benefits of filing Income Tax Return:
Loans and credits:
In order to urge a loan, one should have the tax Returns for the last three years. All banks and lending institutions invite a minimum of three years of tax Returns to grant a loan to a private . At the time of processing application , banks and lending institutions check the declared income and source to verify the repaying capacity of the individual seeking a loan. They use tax Returns to verify an equivalent .
In case you're seeking a private loan, a home equity credit , or a automobile loan , it's essential for you to file tax Return. If you often file tax Return, you'll get a loan from any bank or financial institution very easily. Even the banks prefer allotting credit cards to perons who file regular tax Returns.
Easy to claim your TDS:
TDS means Tax Deducted at Source. it's a Tax deducted from your income by the person paying the salary or making the other payment on which TDS is applicable. The deductor while making the payment deducts the tax amount and pays it to the tax department directly on your behalf.
You may get the tax amount so deducted by filing tax Return. If there's no tax amount payable at the time of filing the tax Return, the entire TDS amount are going to be refunded.
If you're working as an employee during a company and earning but Rs 2.5 lakh a year, you'll claim your TDS from the Tax department. just in case you're a businessman and need your TDS to urge back in your account, it's mandatory to file an ITR per annum .
For going out of country
In order to use for a VISA to go to any country, you would like to possess tax Returns. While giving VISA, embassies officials check the income proofs and address proofs of a private . Thus, tax Returns are checked by the officials to verify the income and address. Therefore, if you're getting to go abroad, you want to get your tax Return filed immediately.
From the fiscal year 2017-18, tax Return of a previous year are often filed within the same assessment year only. After the top of the assessment year, the tax Return of the previous year can't be filed.
Required for giant insurance cover:
If you would like to use for an insurance cover of over INR 50,00,000 (Rupees Fifty lakh only), the insurance companies invite tax Return. The annual income and tax returns help insurers to work out the precise premium amount and security amount. Most of the days , tax Return may be a necessary document for purchasing an insurance cover.
Helps in executing financial transactions:
Income Tax Return is required just in case of executing some financial transactions. Transactions or payments for house, car, mutual funds etc require tax Returns. Some payments for giant investments also need tax Returns.
Income Tax Return works as an address proof in many government organisations and agencies. you'll use it as an Address proof in situ of unavailability of other documents.