2. If you earn any kind of income in India, you are liable to pay
income tax as per the IT Act. Once the tax is paid, you are also
required to file tax returns for the same. If you fail to pay the
income tax on time or do not file tax returns, you will be
required to pay the penalty. In some cases, it could also result in
prosecution.
As income tax can be a significant portion of your income, it is
very natural to think about the benefits of income tax and filing
returns for the taxpayers. If you are wondering the same, here
are some benefits you should know about-
NATION BUILDING
LOAN PROCESSING
ADDRESS PROOF
CLAIM TAX DEDUCTIONS
HIGH-VALUE INVESTMENTS
3. Taxes is one of the primary sources of income for the
government, the money collected in the ex-chequer is used
for building infrastructure and other development activities.
The government spends the collected money on defence,
healthcare, infrastructure, education, and launching various
schemes for the masses.
4. 2. LOAN PROCESSING
Apart from helping the nation, there are also several
personal benefits of income tax filing. For instance, if
you want to apply for a loan like a personal loan or
home loan, you will be required to submit income proof
such as your income tax returns. In most cases, a
lender will require you to submit ITR of at least three
years.
3. ADDRESS PROOF
Another important benefit of income tax is that the tax
assessment documents work as address proof. There
are several documents such as passport, visa
application, Aadhar card, license, etc. for which you are
required to submit address proofs. Standard proofs like
ID cards are generally not valid for such documents.
Your income tax documents can be used in such cases.
5. 4. CLAIM TAX DEDUCTIONS
One of the biggest benefits of income tax return is claiming tax
deductions. There are several ways in which you can reduce your
overall tax liability. If you have made such tax-saving
investments but have paid more income tax in the form of TDS,
you can claim a refund for the same by filing tax returns.
5. HIGH-VALUE INVESTMENTS
High-value investments such as purchasing a property are
reported to the IT department. When you pay taxes and file
returns, these transactions can be reported and substantiated as
per your income.
As you can see, there are several benefits of income tax return
filing and paying income tax. Play your role in nation building
and experience all the other benefits listed above by
understanding your tax liabilities and paying them on time.
