Importance of Income Tax Filing

Do you think it’s late for filing income tax returns ( ITR )? Get ready with the significant documents to complete the tax filing process on time.

Even though the online method has made the filing of tax returns easier, many taxpayers still find it a difficult task, as the practice is the key.

If you fall under the category of people who believe tax filing is not necessary, that’s not the right thought.

Tax filing is a legal obligation that must be fulfilled by every individual who is earning an income above the fundamental exemption slab within a given financial year.

Filing Income Tax Returns indicate your responsibility

• By contributing to the national income, you are proving yourself more of a responsible citizen. Here are some of the reasons why the filing of tax returns is important.
• Understanding your tax obligations and following to comply with rules in a timely and lawful manner makes you a more responsible citizen of the country.
• Your credibility and trustworthiness in most business or individual backgrounds are improved by filing REGULAR returns.
• Those who are purposely evading taxes can come under scrutiny, receive notices, and bear heavy penalties. In any extreme case scenario, the IT department even can initiate criminal action.

Mandatory Need for Tax Filing in a few cases

One of the plus points of fast registration of immovable properties can be initiated if you are a regular taxpayer, even if your gross income for the current year falls below the lowest tax bracket.

Some states in India even require the submission of income tax returns of the past three years even if it is a NIL. Thus smooth processing of the transaction is enhanced by the respective departments.

Looking for a loan from a financial institution

INDIAN IT department is working systematically so that regular tax filing is recorded with and reflects a standard proof of your income.

This comes in handy when you are applying for a credit card or loan (a housing, education, or vehicle loan).

Your financial conditions are analyzed by banks or other lending institutions this way, which impacts the creditworthiness of your application.

Therefore, filing taxes initiates an easier supporting method to raise funds and process credit card applications.

Claiming Any Adjustment Against Past Losses

Taxes that are paid within the given period can compensate losses (whether speculative/non-speculative, short term/long term) incurred in the previous year with future capital gains.

You cannot carry forward any no adjusted losses to the subsequent year or avail of the set-off benefits provided by the tax authorities if your ITR is not filed on time.

Supporting Document For Visa Processing

Thinking of moving to a different country?
Or planning an itinerary to travel abroad?

Then, file your tax returns on a regular basis. One of the mandatory prerequisites is proof showing your financial stability for visa approval for many countries.

The attested copies of your tax returns of the past few years are a must for processing your visa application by the consulates of countries like the US, UK, and Canada.

Now you have understood the importance of filing income tax returns, so get your relevant supporting documents ready as soon as possible.

However, if you find the ITR filing process confusing and difficult to tackle, we recommend you to hire a professional to help you with it.