Being a Citizen of India, it is our moral duty to timely file Income tax returns and pay taxes. By doing so, we contribute in nation building.

Apart from being moral duty, provisions of section 139(1) of the Income tax Act, 1961 make it mandatory for every organization or person to file its return of Income, subject to some conditions.

Table of Contents

• Claim of Income Tax refund
• Carry forward of losses to next year
• Income and Address Proof
• ITR is an Essential Document
• Easy Loan Processing
• Easy Credit Card Processing
• Hassle Free Approval of Visa Application
• Avoid Penalty
• Excess Interest Can be Avoided

This article will help you to know the Benefits of filing ITR (Income Tax Return)

To know the benefits of filing ITR, one should know What is ‘ITR’?

‘ITR’ is a form in which a person fills details of their Income, Deductions, Exemptions, Tax payable, if any, etc. This form is digitally submitted before the Income tax department.

We often think that a person is liable to file ITR, ONLY when there is a tax liability, which is not true.

A person is liable to file a return of income if their total income is more than the maximum amount which is not chargeable to tax. The liability of filing ‘ITR’ is irrespective of the fact that there is any tax liability or not.

Individuals whose gross income is more than the basic exemption limit has to file ITR -

We have already discussed that filing an Income tax return is our moral duty and also a compulsion of law. Filing of ITR also brings various benefits for an assessee.

Let’s discuss a few benefits of filing Income tax as under:

Claim of Income Tax refund

The first benefit of filing income tax return is to claim an Income Tax Refund. Mostly, the aggregate TDS deducted is quite higher than the actual tax payable which can be claimed as a refund by filing ITR. So for claiming Income tax refunds, one needs to file ITR.

Carry forward of losses to next year

If in any financial year, a person incurs loss under one or more heads of income, it can be set off from income of other heads. This is subject to certain conditions as per the provisions of the Income tax Act.

However, if there remains a loss which needs to be carried forward to the next year, one needs to file an income tax return on time. Only then can the remaining loss be set off to the next financial year. So, filing of income tax return is a must in case of carrying forward losses to the next year.

Income and Address Proof

Another benefit of filing an income tax return is having proof of income and address. An income tax return is proof of income as well as can be used as address proof.

ITR is an Essential Document

ITR is always an essential document as it contains details of Income & Taxation for each individual year.

Easy Loan Processing

Another benefit of filing an income tax return is Easy Loan Processing. ITR is considered one of the main documentary proofs of income. Filing an ITR helps individuals as well as other organizations in easy processing and approval of bank loans. If an individual or organization requires any loan, major banks will ask them to submit ITR. So, if a person files ITR on time, it would help in easy processing of a loan.

Easy Credit Card Processing

Another advantage of filing an income tax return is easy credit card processing. Filing ITR on time also helps in easy processing of credit card applications, as ITR is considered one of the main income documentary proofs.

Hassle-Free Approval of Visa Application

Another benefit of filing an income tax return is hassle-free approval of visa applications. Various embassies are very diligent about tax returns of individuals applying for visas at the time of processing visa applications. The authorities ask for a copy of past tax returns with other documents. That is also a reason to file ITR in order to make such an application process hassle-free.

Avoid Penalty

Next advantage of income tax return is to avoid penalty. Timely filing of ITR helps to avoid penalty which are levied by Income tax department due to late / non filing of tax returns. As of now Income tax department charges penalty of Rs 5,000/-.

Excess Interest Can be Avoided

The last benefit of filing an income tax return is to avoid excess interest. To avoid the payment of interest, it is always better to pay taxes on time and simultaneously file timely returns.

Now you are aware that there are many benefits of filing an Income tax return and paying income tax. So, file CA Assisted Income tax return on time through Manthan Experts now and get the above-discussed benefits.