Five Reasons to File Tax Returns (Itr)

We understand that filling out IT returns takes time, especially if you are young and have just filed a few. The benefits, however, outweigh the time and effort involved in filing it. It is also the obligation of all country's responsible citizens.

Income Tax Returns are mandatory for certain taxpayers but optional for others, according to income tax legislation. It is vital that you file it, regardless of whatever group you belong to. The Internal Revenue Service now allows you to file your tax return online, which takes only a few minutes in most cases.

This essay discusses five key reasons why you should file your taxes on a regular basis.

Who is required to file income tax returns?

According to income tax legislation, any assessee whose gross total income (GTI) exceeds the lowest income tax bracket for his or her age must file an ITR. The basic exemption limits for assessees under 60 years old, between 60 and 80 years old, and over 80 years old are 2.5 lakh, 3 lakh, and 5 lakh, respectively.

Individuals who have a GTI below the basic exemption amount may be required to file an income tax return in certain circumstances. If you fall into one of the following categories, you must file an ITR.

If your electricity bill totals more than 1 lakh for a single bill or the entire financial year.
If you have a bank or cooperative bank current account with a balance of one crore rupees.

Tax returns are filed for a variety of reasons.

Here are five reasons why you should file your income tax returns.

It simplifies the loan application process.

Let's say you'd like to apply for a home loan or any other type of loan (other than mortgage). A lender will usually want proof of income before authorizing a loan. As part of the procedure, you will be needed to submit your income tax returns for the past two or three fiscal years.

It assists you in claiming any losses that have been carried forward.

You must file an income tax return if you have losses under the titles "Capital Gains" or "Profits and Gains from Business or Profession" that you intend to carry forward to the next fiscal year.

You can use it to get TDS refunds.

You can claim a deduction by filing your income tax return for the year by the deadline if your employee deducts tax at source or you have a contract that requires TDS. The income tax department adjusts the TDS paid and calculates your net tax due in such cases. If you are not required to pay tax, you can request a refund by filing an ITR. Check the status of your tax return to see how far along you are with your refund.

It aids in the development of a country.

Every tax you pay contributes to your country's progress. It is a significant source of revenue for the government. The money could be used by the government for infrastructure or other development projects.

It will assist you in obtaining a visa or obtaining a credit card.

If you're applying for a visa or a credit card for an international trip, the issuer will ask for proof of income. In most cases, you will be required to furnish tax returns from the prior three years. It will help the other party figure out whether you are eligible for a visa or credit card. If you plan to go to the United States, Canada, or any part of Europe, you must submit your ITRs during the verification process.

Suggested Read: Income Tax Notice