Voluntarily filing ITR can help students and job seekers in actively manage their financial future and can secure a stronger position for their future goals.
Vanshika verma | Aug 21, 2025 |
Why Students and Unemployed Should Start Filing ITR: Know Hidden Benefits of Filing ITR, Even If You Don’t Earn
Do you think that filing ITR is only for salaried employees or businesspersons? If you think so, then you are wrong.
There is a big misconception that filing an Income Tax Return (ITR) is mainly for salaried employees or business owners; however, a rapidly increasing number of students and unemployed youth are being encouraged to file their ITRs even when their income is below the basic tax exemption limit. This offers major benefits that can pave the way for future stability.
The Income Tax Act mandates ITR filing only for individuals whose annual income exceeds the basic exemption limit. According to the latest rules, the limit is Rs 2.5 lakh under the old tax regime and Rs 3 lakh under the new tax regime. This usually excludes most students and unemployed individuals. But professionals highlight that voluntary filing is a smart financial habit.
The process of filing an ITR has been smooth and can be finished online with just a few basic documents. The primary documents are-
By adopting this habit early, students and the unemployed can actively manage their financial future and secure a stronger position for their future goals.
Here are the benefits of filing an income tax return (ITR):
Easy loan Approval
Filing ITR helps in creating a strong financial history. This can be beneficial for applying for loans in the future, whether for a home loan, car loan, or business loan, because banks and financial institutions always ask for ITR as they consider it a testament to your financial discipline and creditworthiness.
Proof of Income
Filing ITR serves as an official document of your income, and is often a compulsory requirement for various applications such as:
In the event of an important financial transaction in the future, such as depositing a large sum of money example, Rs 50 lakhs or more in your bank account, a history of ITR filings can provide a credible explanation for the source of funds, avoiding investigation or inquiry from the tax authorities.
Claiming Tax Refunds
You can claim a refund for the excess tax paid. If a bank deducts Tax Deducted at Source (TDS) on interest earned from fixed deposits or if TDS has been held on payments for freelance work, then the only way to get the money back is by filing ITR.
Carrying Forward Losses
ITR filing is essential for people who have invested in stocks or mutual funds and suffer losses because it will acknowledge you to report these capital losses and carry them forward for up to eight subsequent years.
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