An ITR (Income Tax Return) is an arrangement that enables a taxpayer to disclose the details of their income, claims valid deductions as well as exemptions & taxes that are owed on the taxable income. Every individual should file ITR whether income range is taxable or non-taxable as in that way they will declare all sources of income. Some of the benefits of ITR filing include:
- It will stand as a legal proof of collected income in an individual account over the years.
- If planning to travel overseas in near future then ITR filing will serve as income proof for the processing of VISA.
- ITR works as convenient legal proof of revenue for Self-employed or businessman as they cannot provide proofs like salary certificate or Form 16
- If an individual had incurred capital losses in short term, Income Tax department permits them to carry forward their losses and balance it against profits.
- Generally salaried people’s tax gets deducted automatically as per their slab now by filing ITR they can easily claim of excess tax deducted from Income Tax Department
Then if applying for loan like car, home or personal, it will require ITR for latest 2-3 years as mandatory document. If ITR has regularly been filed getting loans becomes easier.
While purchasing a high life insurance cover, the insurance companies basically ask for proof of income for assessing the required amount to be covered. Some of the mandatory documents required by them include around 6 months bank statements, ITR of 3 consecutive years or salary slip by the employer.
Thus, filing ITR becomes very important for every individual as in that way they declare all the sources. This way not only they get individual benefits but the overall economy will be benefited.