1 – Compensation on capital loss:- If you invest in the stock market and your capital decreases due to weakness in it, then it is called a capital loss. The advantage of filing ITR on time is that you can adjust the loss with such benefit in the future.
2- Necessary in big transactions:- If you do any transaction for more money, ITR proves to be helpful for you. Due to the timely filing of ITR, you do not risk getting a notice from the Income Tax Department after buying or selling property, depositing a large amount in a bank, investing in a mutual fund.
3- Bank loan, credit card convenience:- If you want to take a loan from a bank, ITR is the best proof to prove your income. Banks ask for a 2-3 years income tax return from a customer for a home or car loan. If you have a copy of ITR, it becomes very easy to get a loan.
4- Required for TDS Claim:- If any tax has been deducted on your earnings (TDS ie TDS at source) then it is necessary to file ITR to withdraw it.
5- Convenience to get a visa:- If you want to go abroad for business or a job, then ITR is necessary for you. Many foreign embassies demand income tax returns of the last 2 years in the visa application. If you have an ITR, it is easier to get a visa than the other person.
6- Profitable for business:- ITR is very important in starting your business. Also, if you want to get a contract with a department, you have to show ITR. To get a contract with the government department, an income tax return of the last five years has to be given.
7- More insurance cover will be available:- If you want to get an insurance cover (term plan) of one crore rupees, then the insurance companies can ask for ITR from you. In fact, they only depend on ITR to know the source of your income and check its regularity.
8- Exemption from penalty:- If there is a delay in filing an income tax return, you may have to pay a fine of up to Rs 10,000. The penalty can be avoided by filing ITR at the right time, if you file an income tax return at the right time then you do not even have the risk of taking notice from the Income Tax Department.
9- Proof of address:- A copy of your income tax return is proof of your residence. You can use it in all government work. If you want to get Aadhaar or Passport made, you can use ITR as your proof of address.
10- You can get relief from interest:- If you have to pay income tax and cannot file ITR on time, then you may also have to pay the interest along with income tax for filing a late return. You can also be fined under Section 234A of the Income Tax Act. You can avoid fines or interest by filing income tax returns on time.
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