A person is required to submit an Income Tax Return (ITR) to the Income Tax Department of India. It comprises details on a person’s earnings and the taxes that must be paid by them each year. The information in an ITR must be for a certain fiscal year, which begins on April 1 and ends on March 31 of the following year.
Income can come from various sources, such as:
- Salary
- Business and professions’ profits and gains
- Rental income
- Other sources of income comprise dividends, interest on savings, royalties, lottery winnings, and so on
Everyone must file their ITR within the deadline. The eligibility of ITR forms varies depending on the taxpayer’s sources of income, the amount of income earned, and the taxpayer’s classification (individuals, HUFs, corporations, etc.).
The deadline to file an income tax return (ITR) for the assessment year 2021–2022 is December 31, 2021. According to the Income Tax Act, individuals whose taxable income exceeds Rs 250,000 must file tax returns in India. Individuals who pay more than Rs 100,000 in power bills or who spend more than Rs 200,000 on foreign travel must also pay income taxes.
Do you have any questions as to whether or not you should file your taxes?
Perhaps you read online that even if your earnings are below the minimum exemption amount, you should file a tax return. Analysts say that even if you don’t incur any taxes, you should still file your income-tax return on time to enjoy several benefits.
1.Processing of loan documents
Individuals will benefit by filing the ITR when applying for an automobile loan, a home loan, a personal loan, and other types of loans. As proof of income, all financial institutions might ask for a copy of your tax returns. For loan approval, this is a required document. Salaried and self-employed people can considerably profit from this because they don’t need to show any other documents as proof of income and can acquire loans quickly.
2. Visa application processing
When people want to work or travel outside of India, most embassies and consulates need copies of their tax returns for the previous two years. The submission of tax returns guarantees that VISA applications are processed quickly because the individual is deemed tax-compliant by immigration officials.
Because this document serves as verification of an applicant’s earnings, the embassy will examine the information to ensure that he or she is financially capable of covering the trip costs. This is some of the legally required paperwork, so filing your ITR on time is usually a good idea.
3. Get a Tax Refund
Tax may have been deducted (TDS) from your earnings even if your total taxable income is less than the basic exemption limit and you have no tax due for the year. In this case, you’ll have to claim a TDS refund and file an income tax return.
4. Credit Card Processing
If you haven’t filed your ITR, banks may deny your credit card application.
5. Use this as proof of address
Income tax return receipts are mailed to your registered address and can be used as proof of residency.
6. Income proof
Unlike salaried individuals who receive a salary certificate on Form 16, self-employed taxpayers have no proof of income. As a result, the income tax return acts as proof of income for these self-employed individuals, providing a full breakdown of their revenue and expenses for any given fiscal year. Self-employed taxpayers can also use these records as proof of income in several situations.
7. Purchasing a higher-coverage insurance policy
Insurance firms will not issue you plans with higher coverage if they have grounds to assume you are a tax dodger (due to non-compliance).
8. Providing proof of income in compensation cases
The ITR can be used as proof of income in the event of a self-employed person’s death or disability. Although the Motor Vehicles Act does not make it mandatory to furnish an ITR when determining compensation in the event of accidental death or disability, the Delhi High Court approved claims tribunal procedures that reference the need for an ITR in the case of self-employed individuals.
9. Compensation for losses
Any firm or business can experience a loss at any moment during a fiscal year. To claim defined losses for an individual taxpayer, such as losses from capital appreciation, business, or profession, etc., filing a tax return by the given deadline is required. Companies must file IT returns to make up for the loss. This process allows you to carry forward your tax liabilities into the next year. Taxpayers, on the other hand, must file an ITR before the due date to claim losses in the future.
10. Being a law-abiding citizen
Being on the right side of the law helps more than anything else. It’s also a good idea to keep your income tax department up to date on your earnings and taxability. Only when you file your ITR will you be able to communicate with the IRS.
Note:
For the assessment years 2021–2021, the deadline for filing income tax returns is December 31, 2021. Komplytek will make it simple for you to file your ITR. Komplytek’s experts will ensure accurate tax filing and the highest possible tax refund.
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