• Government formulates India’s Income Tax Laws. The government taxes the taxable income of all individuals, Hindu Undivided Families (HUFs), corporations, firms, LLPs, associations of persons, bodies of individuals, local authorities, and other artificial juridical persons. According to these laws, a person’s tax liability is dependent on his residency status. Every person who qualifies as an Indian resident is required to pay tax on his or her worldwide income. Each fiscal year, taxpayers must adhere to specific filing requirements when submitting their Income Tax Returns (ITRs).

• The Income-tax return (ITR) is a form used to provide the Income Tax Department with information regarding your income and taxes. A taxpayer’s tax liability is computed based on his or her income. The individual will be eligible for a tax refund from the Income Tax Department if the return indicates that excess tax has been paid during the year.

• In accordance with the income tax laws, a return must be filed annually by any individual or business earning income during a fiscal year. The source of the income could be a salary, business profits, rental income, dividends, capital gains, or other sources.

Claim Excess TDS

Even if your income is not subject to taxation, you may still have tax withheld from your salary, FD, or any other source of income. For example, if your total income is less than 2.5 lakhs but you received Rs. 1 lakh from an FD in the bank, the bank ought to withhold 10% of tax on this amount from your overall income. In such a scenario, the tax that was withheld by filing an ITR may be eligible for reimbursement. To put it more simply, an individual is required to file a tax return in order to be eligible to claim any TDS that was deducted at the source.

A perk for your Visa Application

If an applicant for a visa includes evidence of their ITR in their submission, there is a lower chance that their visa request will be denied or identified as problematic. The individual’s completion of their tax return is evidence that they are a responsible member of society. ITR is required for visas in a number of countries these days because of rising concerns about national security. When applying for a Schengen visa, for instance, you are required to submit the tax returns you have filed in the three years prior to the application, even if you have not had any income during those three years.

Easy processing of Documentation

The individual’s tax return is a crucial document that is required in order to process applications for a variety of different reasons. For instance, when an individual submits an application to a bank for the processing of a mortgage or an auto loan, the banker will request copies of the individual’s most recent tax returns in order to validate the individual’s sources of income. It is easier to have a smooth processing experience if tax returns are filed on a prudent basis rather than having to explain why returns for certain years were not filed. In addition to facilitating the acquisition of a loan, the income tax return facilitates the process of acquiring credit cards, insurance policies, and other financial products.

Can be Used as Income Proof

Taxpayers who are self-employed do not have any proof of income, in contrast to taxpayers who have salaried employees and receive a salary certificate in Form 16. Therefore, the income tax return acts as proof of income for these taxpayers who are self-employed, providing a detailed breakdown of the income and expenses that these individuals incurred during any given fiscal year. In addition, taxpayers who are self-employed can present these documents as evidence of their income before a variety of different forums.

• Numerous individuals appear to believe that filing tax returns is optional and, as a result, disregarding it as unnecessary and burdensome. As we shall see, this is not a particularly healthy outlook on tax filing. Filing tax returns annually is considered a moral and social obligation of every responsible citizen. It provides a platform for the assessee to claim refunds and other forms of relief from time to time. It serves as the government’s basis for determining the amount and manner of citizens’ expenditures. Even if your income level does not require you to file tax returns, it may still be prudent to voluntarily do so. Filing returns facilitates the transaction’s registration.

• Filing tax returns demonstrates responsibility. The government requires individuals with a certain annual income to file an income tax return by a predetermined deadline. Your loan or credit card company may require your tax return. A tax return is required if you wish to claim an adjustment for past losses.

• PAN Card

• Aadhar Card

• Form 16

• Form-16A/ Form-16B/ Form- 16C

• Bank Account details

• Form 26AS

• Home Loan Statement

• Tax Saving Instruments

• Capital Gains Details

• Rental Income

• Foreign Income

• Dividend Income