What is the benefit of filing income tax return? This is the first question when a client ram into the office of a CA or Tax lawyer. Generally professionals have predefined answers like it benefits for Loan, CC limit, or being loyal with the govt etc. But do every one of us know what is the RARE benefits of filing Income tax returns regularly i.e. without any gap? Here is the answer
Yes, in Judicial jobs or where a the candidate is a Chartered Accountant or Lawyer and need to demonstrate annual professional income for the Judicial/judge’s,Senior Auditors post.No client data or record of similar work done previously shall matter to the selection body, it is only the last 5 to 7 year income tax returns ( in judicial 7 year ITR record is checked in interview) that shows the candidate’s credibility for he has done good practice having huge clientele of that caliber for the judicial post/class one post.
Life is uncertain, this is one of the rare benefit of filing the ITR every year.It does not bother if the income barely touches or crossing the taxable limit. If you keep filing ITR of yourself or spouse, just because CA /Lawyer is your neighbour or charge very nominal fee, it can help you in future in case of accidental death of any one member/’s during roadside accident, because during court trial insurance company need the proofs of income to arrive at the amount of accidental claim, if any return is missing, mainly last 3 years, this could lower the claim amount or even no claim because court take ITR as only evidence. No wealth record, FD’s, business etc is given that much importance as compared to ITR in the eyes of law.The formula for claim is by multiplying the Yearly income in ITR with years of expected life of deceased.So next time give special thanks to your tax professional to remind you every year about the regular return filing.Taxability of Motor Acccident Compensation & Interest
This is another benefit of filing your ITR regularly. The High Commissions of various countries or VFS centres across India have huge record of fabricated documents in which income tax returns of visa applicants are one of them. Why, because travel agents forge it or sometimes show it as regular income tax return by charging huge money. Every assessee should file genuine return if intention is in mind to go aboard in future.Use it showing your all genuine source of incomes, because immigration officers give due wheightage to your annual income. Absence of any single year returns can decrease your chances of foreign visa under visitor, investor or work permits category.
One of the services of all banks either private or Nationalised is to finance the customers in the shape of bank loans, CC Limit or project funding etc. Income tax returns of last three years are the basic need for it except agriculture limits, secondly the PAN is checked over the CIBIL website if Individual or corporate body is not a defaulter in any previous bank. The CIBIL Score plays a critical role in the loan application process.Because this agency keep the record of your instalment payment nature,as it gives the score to your bank which is required for the particular approval of loan case. That is why according to the Supreme court order,hard recovery of all loans is banned, especially in car loans no forceful possession can be taken by the bank. CIBIL just blacklist such customer for all future loans all over India, based on the PAN card number allotted to such loan defaulter.Important Points For Salaried Persons For Availing Bank Loan
As described in point one earlier, the value of business profiles of various corporate agencies, contractors, professional service providers or Individuals is dependent on the yearly income tax returns.Sometime contractors have very good history of procuring heavy projects in their line, be it a service or works contract,but they they lack the knowledge & benefit to file the returns on time or sometimes the returns were not filed on the factual provisions (i.e defected returns). For contractors, these returns needed not only to be filed on time, but must be very much accurate,& audited (if required),these must be signed with necessary documents because in tender- approval meetings or for finalising professional panels, the selection body has ample options to mature the tender in favour of the fittest. Sometimes this work is checked by the tender scrutiny committee and five to seven years ITRs are considered to see whether the applicant has done the work of that much amount earlier or not. So next time to enlarge your business horizon and obtaining more tenders from Govt or private bodies, one need to file the regular returns every year.
(By : Advocate F.S Dhiman, Chief Counsel at Ferry Dhiman & Co. ( corporate law firm, India www.lawferry.com ) contact mail firstname.lastname@example.org)
Do you think CBDT should extend Tax Audit Report and relevant ITR Due Date? Please Comment, Vote, Retweet and Like.— Tax Guru (@taxguru_in) September 18, 2018