As per section 139(1) of Income tax act,1961,
(a) being a company or a firm; or
(b) being a person other than a company or a firm, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed.
Major Benefits of Income Tax Returns:
1. Easy Loans Approvals: Majority of Banks ask for a copy of Income tax returns for at least 3 consecutive years, so if you are planning for a loan in future then it can help you for easy loan approvals like Home Loan, Personal Loan etc.
2. To Claim TDS Refunds: As an individual if someone has invested in Fixed Deposits the interest income is chargeable to TDS at the rate of 10% irrespective to the fact that the individual is liable to pay tax as whole or not. By filing Income tax return you are benefited to get refund of TDS deducted if the individual is having income below the taxable limit.
3. Carry Forward of Losses: If anyone having losses in a year then by filing the Income tax return he can carry forward that loss for next 8 subsequent years to set off the same by the future income and helps to reduce the burden of tax in future.
4. VISA Processing: If you are traveling overseas, foreign consulates ask you to furnish ITR receipt of the last couple of years at the time of the visa interview. Some embassies may ask for ITR receipts of previous three years, while some others may ask for the most recent certificate.
5. Buying a high life cover: These days Life insurance companies asks for ITR receipts if you opt to buy a term policy with sum insured of Rs 50 lakh or more.
6. Government Tender: If someone plans to start their business and need to fill a government tender, they will need to show their tax return receipts of the previous years which can be ask also for 5 Years. This again, is to show your financial status and whether you can support the payment obligation or not.
7. Self Employed: Salaried persons gets Form 16 as their income proof but Businessmen, consultants and partners of firms do not get Form 16. Hence, ITR receipts become an even more important document for them, provided their annual income exceeds the basic exemption limit of Rs 2.50 lakh. For all sorts of financial transactions, ITR receipts will be the only proof of income and tax payment for the self-employed.
8. Avoid Interest on Tax liability: If you don’t file ITR, the belated return could lead to extra interest on monthly basis for the remaining tax payable by you.
9. Penalties and Assessments: If any person liable to file tax returns but didn’t, then he will be liable to penalty of up to Rs.10,000 for not filing of the return within the due date in addition to the assessment findings.
So make sure to file your Income Tax Return this time on or before due date .i.e. 31st August 2019 (Extended from 31st July 2019) to avoid penalties and to take above mentioned benefits.
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