Why you must file income tax returns every year before 31st July
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Why you must file income tax returns every year before 31st July

Income tax return is the government’s way to keep records of our sources of income and also to earn the necessary tax from the required individuals. Every year the deadline to file your returns is set at 31st July.

All individuals who earn income must declare it and file their returns. The minimum income requirement to file a return is 5 lakhs per annum. If your salary is above this figure, you must file your returns mandatorily. In case it is below 5 lakhs then you don’t have to compulsory file it. But we highly suggest you still fill it as there are many benefits associated with it.

Here are 7 important benefits:

Refund claim:

The first most important benefit of filing income tax returns is that you can claim refund. The best way to do this is through TDS (Tax deducted at source). If in your income sources, TDS was deducted, you can claim a refund for it.

ITR Receipt makes life easier in many matters:

Whether it’s a Bank or an NBFC they would require your income proof via Bank statements but with an ITR receipt it gives them a clear picture of how much you earn and your source of income.

You can utilize the ITR receipt as address proof:

After successfully filing your returns, an ITR receipt is sent to your registered address. This can be used as address proof whenever you have to present proof.

Avoid penalties set by the tax department:

If you don’t file income tax returns, you will have to pay up to 10,000 rupees. Hence filing your returns is a better option than being fined!

Helps during Insurance application processing above 50 lakhs:

When you opt for a term insurance above 50 lakhs, insurance providers will ask you to furnish ITR receipts.

Returns are very important for self employed professionals:

Since self employed professionals don’t have Form 16, it becomes all the more important that they file their returns as the ITR receipt will act as the only proof of income and payment for them.

Helps during Visa application procedure:

There are many countries that require your past income history. The best way to show that is through your past ITR receipts which can only be generated when you file them.

You can also read – 7 Factors That Affect Your CIBIL Score

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