There are several benefits of income tax return filing in India,
some of which are:
1. Compliance with the Law: Filing an income tax return is mandatory for individuals and entities whose income exceeds the specified limit. Filing a return ensures compliance with the law and avoids any penalty or legal action for non-compliance.
2. Claiming Tax Refunds: If an individual has paid more taxes than the actual tax liability, he/she is entitled to claim a refund. Filing an income tax return is necessary to claim the refund.
3. Easy Loans and Visa Processing: Filing an income tax return is considered as proof of income for individuals. This helps in easy processing of loan applications and visa applications.
4. Carry Forward of Losses: If an individual incurs a loss in a particular financial year, he/she can carry forward the loss and set it off against future profits. This can be done only if the individual files an income tax return.
5. Buying High-Value Assets: When an individual plans to buy high-value assets like a house or a car, the income tax return serves as proof of income. This helps in the loan approval process.
6. Avoiding Penalties: Non-filing of an income tax return can attract penalties and legal action. Filing a return on time ensures that there is no penalty or legal action against the individual or entity.
Overall, filing an income tax return is important not only to comply with the law but also to claim benefits like tax refunds, carry forward of losses, and easy loan and visa processing.
