Filing of tax returns in India is mandatory for people only their taxable income exceeds Rs 250,000. Besides, individuals paying towards consumption of electricity quite Rs 100,000 or those that have undertaken foreign travel for over Rs 200,000 also are required to file an income tax return. However, there are many other benefits pursuant to filing the income tax return albeit you earn below the taxable limit. Here we are enchanting a glance at a number of them:
- Claiming a tax refund
Certain passive income like term deposit interest or dividend income suffers tax coverup. for several individuals, these might be exempt if it’s below the edge. “Most of the individual taxpayers having only the above-stated income would wish to file the tax returns for claiming refund of taxes. Even within the cases of salaried taxpayers where additional taxes are withheld, filing of returns would be mandatory to say the refund of excess taxes. By filing an ITR online, the refund of taxes are often claimed within the individuals checking account that’s KYC-compliant,”
2.Processing of Documents
The income-tax return may be a key document for the aim of processing applications for various purposes. for instance, at the time of lodging an application for processing of a house or automobile loan, bankers seek copies of tax returns filed to verify the individual’s sources of income.
3.Application for VISA
Where individuals are getting to take up employment or conduct business visits outside India, the immigration authorities request copies of tax returns filed within the past. The income tax return filing ensures in smooth processing of VISA applications as immigration authorities then deem the individual as tax-compliant.
4.Claiming losses
Filing of income tax return within the maturity is mandatory to say specified losses for a private taxpayer, like losses from capital gains, business, or profession, etc. By opting to file tax returns, not only does it benefit the individual to say the losses carried forward in future years, but it also is a document to trace losses that will be claimed within the future. for instance, a private taxpayer who makes take advantage of the sale of mutual funds or equity shares can adjust these profits with losses incurred within the past by filing tax returns on time.
5. Is Proof of Income
Self-employed taxpayers don’t have any proof of income, unlike salaried individuals who receive a salary certificate in Form 16. Therefore, the tax return is a symbol of income for these self-employed taxpayers with a detailed breakdown of income and expenses incurred by these individuals during any fiscal year.
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