CA Neeraj Bansal
Income tax return is a statement of your earnings from various Sources of income, tax liability thereon, details of tax paid and any refunds that have to be given by the government. And hence the deadline kept to furnish these details is after four months from end of the financial year so that taxpayers have sufficient time to aggregate the data for the whole year and report accurately and in time to the government.
Non-filing of Income Tax Return attracts interest, penalty, prosecution and scrutiny from the Income Tax Department. There are some myths associated with filing; a common fear is that the taxman comes knocking at the door if the tax returns is filed.
However, the benefits lost on non-filing of returns are more than the penal provisions imposed for non-filing. Following are the benefits of filing of the income tax returns:
This form can be used by Individuals who drive income from salary/pension or income from house property (excluding where loss brought forward from previous year) or income from other sources (excluding winnings from lottery and income from horse races).
1. In case excess TDS has been deducted on your income and you need to claim a refund, in this situation you must file a return to claim the tax refund.
2. When you reach out to a bank or a financial institution for a loan, a house loan or a personal loan then they usually require copies of your IT returns to check your credit worthiness. And therefore, it makes sense to keep your finances in order and file an IT return.
3. Some countries require copies of your Income Tax Returns when they provide you a travel or a work visa.
4. Quick registration for immovable properties in some cities of India can be done if you have filed ITR
5. By Filing of Income Tax Return, You can reduce any possibilitiesof getting income tax notices.
6. Income tax returns can serve as proof for Non ECR (Non Emigration Check Required) while applying for passport. The applicant needs to produce a copy of proof of assessment of income tax returns & actual payment of income tax for last one year or income tax statement that is stamped by the income tax authorities.
This form is used by an Individual or HUF,carrying out a proprietary business or profession and who are not filing Return under Presumptive Taxation Scheme AND ITR 4S (SUGAM):For presumptive Business Income an Assessee needs to file his return using this Form)
1. Though as a Company or a Firm you are required to file a return irrespective of whether you have income or losses. In cases where a person (an individual) has Loss under the head ‘Income from House Property’ or loss under the head ‘ Profits & Gains of Business or Profession’ ‘Capital Gains’ or losses from ‘Income from Other Sources’. Such losses may be allowed to be carried forward and set off (upon fulfillment of certain conditions) provided a Return has been submitted by you in time.
2. Some countries require copies of your IT returns when they provide you a travel or a work visa.
3. For Obtaining Government Tenders ITR is must.
4. Quick registration for immovable properties in some cities of India can be done if you have filed ITR.
5. It is a way of declaring white money.
6. If you have a taxable income then filling of Income Tax Return saves you from penalty and prosecution.
7. Income tax return is essential for making any investment and goes to prove that you have a valid source of income to make such investment.
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(Republished with Amendments by TaxGuru Team)