Benefits of filing Income tax returns
Income Tax returns
July 10, 2019Most important steps to be followed after incorporation of the Company
April 24, 2020| 1) Residence Proof: A tax assessment order can be used as a proof of residence for applying for Aadhar or passport. |
| 2) Hassle free loan processing: Generally, income tax returns of last three years are required, if a person intends to take any housing loan, education or vehicle loan from the bank. |
| 3) Processing credit card applications: Copies of tax
returns are also required as proof for processing credit card applications. |
| 4) Recording of high-value transactions: High-value transactions such as purchase of property, buying a car, investing in mutual funds, etc., are reported to the income tax department. So, by filing income tax returns, one can report these transactions & substantiate the same as per one’s income. |
| 5) Refund of TDS: If TDS is deducted from one’s income, and then the filing of income tax return is required to claim TDS. |
| 6) Carry forward of losses: If a person has incurred a loss from sale of capital assets, house property income, loss from business/ profession, then carry forward of the same to subsequent 8 years, for set off against other income can be done if that person has filed income tax return within the prescribed due dates. |
| 7) Visa processing: Filing of income tax return is a mandatory requirement for the processing of visa. |
| 8) Claiming additional deductions: If a salaried person has filed
income tax return, then he can claim additional deductions which are not considered by his employer while deducting TDS. |
| 9) Avoiding additional interest rates: If a person has not filed income tax return, then a belated return could incur additional interest at 1% per month for the balance tax payable. |
| 10) Avoid penalties: Rs. 10,000/- would be charged for non-filing of income tax return. Also in addition to taxes and interest, there could be prescribed penalties ranging from 50 to 200% in certain cases. |