Any person who is below 60 years of age, and who earns Rs 2.5 lakh annually, is exempted from income tax. However, if an individual earns more than the exemption limit then s/he has to file an income tax return. Even if your salary is less than the income tax limit, you should still file an income tax return, as it has many benefits.If you have not filed ITR yet, then fill it out immediately.
Here are five benefits of filing ITR
1. For loan
If you are going to take a loan, then the bank checks your eligibility, which is based on your income.How much loan the bank will give you, depends on how much is the income that you have filed in the income tax return. Actually, ITR is a document that all banks use for the easy processing of loans.Usually banks demand three ITRs from their customers during loan processing. Therefore, if you want to buy a house by taking a home loan, or want to take a car loan or take a personal loan, then ITR must be filed as it makes it easier to get the loan.
2. Required for Tax Refund
If you file ITR, you can save tax on interest earned on savings schemes like term deposits. Tax can also be saved on dividend income. You can claim tax through an ITR refund, if the total income from multiple sources of income exceeds Rs 2.5 lakh, then you can claim the deducted TDS again.
3. Valid document for income proof
Form-16 is issued to the employees by the company which is their income proof. Even for self-employed or freelancers, the ITR filing document acts as valid income proof.
4. Can claim loss
A taxpayer is required to file an income tax return within a stipulated date to claim any loss. This loss can be in the form of capital gains, business or profession.
Income tax rules allow those who file ITR in the relevant assessment year to carry forward the loss against capital gains.
5. Required for visa processing
If you are going somewhere abroad, then most countries demand ITR. This shows that the person is a tax-compliant citizen. This gives the visa processing officers a clear idea of your current financial situation and income. This makes it easier for you to get a visa.