ITR Filing: 9 Advantages of Filing Income Tax Return in India

Every Indian individual who comes in the ambit of Income Tax, need to file their tax returns every year or submit the tax due on their earnings in a year. And, If you are an individual whose accounts do not need to be audited under the Income Tax Act of 1961, you must file your income tax returns (ITRs) by July 31 of the relevant assessment year. For example, for the financial year 2022-23, you must finish the ITR filing procedure by July 31, 2023. Failure to comply with this regulation may result in fines and the loss of tax benefits.

Conversely, if you file your tax returns on time, you may reap the benefits of filing ITRs by the due date. Let’s take a look at advantages you will get when you file Income Tax Return.

Advantages of Filing Income Tax Return in India

1. Claim Tax Deductions

According to the Income Tax Act, numerous investments and expenses are tax deductible. You can deduct these amounts from your total income, lowering your total taxable income and tax liabilities. To take advantage of these deductions, you must include them in your ITR and file your tax returns by the due date.

2. Easy Loan Approval

As verification of your income statement, many banks want a copy of your tax returns. This is an essential document for loan acceptance.

3. Address Proof

The Income Tax Return can be used to prove your income and residence.

4. TDS Return

There may be times when tax has been deducted (TDS) from your income even though your total taxable income is less than the basic exemption level or you have no tax payable for that year. You may recover the money by filing an ITR and get a TDS refund.

5. Carrying Forward Losses

If your company suffers a loss, it can be carried forward and offset against future years’ profits, decreasing your tax liability.

6. Visa Approval

Most embassies and consultants want copies of your tax returns for the previous two years when you apply for a visa. Therefore, filing an ITR could speed up the visa application procedure.

7. Scholarship Advantages

An ITR can be used to claim particular institute and/or university scholarships. It is regarded as a trustworthy document.

8. Buying Term Insurance

In order to accept term insurance plans, insurance firms need applicants to provide their ITR records as proof of yearly income.

9. Authentic Evidence of Individual Earnings

For self-employed or independent contractors, the ITR filing form acts as real income verification.