We understand that filing IT returns takes time, especially if you are young and have just filed a few. However, the advantages outweigh the time spent submitting it. It is also the responsibility of all responsible people of the country.
Also Read: Income Tax Return Filing
IT returns are mandatory for some taxpayers but optional for others, according to income tax legislation. It is critical that you file, regardless of whatever group you fall into. The Internal Revenue Service now allows you to file your tax return online, which takes only a few minutes in most cases.
This essay discusses five key reasons for filing income tax returns on a regular basis.
Who must submit income tax returns?
According to IRS regulations, any taxpayer whose gross total income (GTI) exceeds the lowest income tax bracket for his or her age must file an ITR. The basic exemption limits for assessees under 60 years old, between 60 and 80 years old, and over 80 years old are 2.5 lakh, 3 lakh, and 5 lakh, respectively.
Individuals who have a GTI below the basic exemption limit may be required to file an income tax return in certain circumstances. If you fall under any of the following categories, you must file an ITR.
- If your electricity cost for a single bill or for the entire financial year surpasses 1 lakh.
- If you have a bank or cooperative bank current account with a balance of one crore rupees.
- If you are a regular resident with income from a foreign nation AND/OR assets in a foreign country AND/OR signing authority over any account outside the country.
- If you spent Rs. 2 lakh on yourself or others for a trip to another country.
Reasons for filing a tax return
Here are five compelling reason to file your tax returns.
- It facilitates loan processing.
Let’s say you wish to apply for a mortgage or another type of loan (other than mortgage). A lender will usually want proof of income before authorizing a loan. As part of the procedure, you will be needed to submit your income tax returns for the preceding two or three fiscal years.
- It assists you in claiming any losses that have been carried forward.
You must file an income tax return if you have losses under the titles “Capital Gains” or “Profits and Gains from Business or Profession” that you intend to carry forward to the next fiscal year.
- You can use it to get TDS refunds.
You can claim a deduction for TDS if your employee deducts it at source or if you have a contractual arrangement that requires TDS. After calculating the TDS paid, the income tax department estimates your net tax liability. The ITR form can be used to get a refund if you are not required to pay tax. Check the status of your tax return to keep track of your refund.
- It helps to strengthen the nation.
Every tax you pay goes toward the advancement of your country. It is a significant source of revenue for the government. In fiscal year 2019, the government collected 9.45 lakh crore in direct taxes. The government might use the funds for infrastructure or other development initiatives.
- It will assist you in obtaining a visa or credit card.
If you are applying for a visa or a credit card for an international trip, the issuer will require proof of income. You will often need to provide tax returns from the previous three years. It will assist the opposite party in determining whether or not you are eligible for a visa or credit card.
Suggested Read: Income Tax Notice
