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Payment of Taxes Or Filing Your ITR- Duel Ends
Written by Gagandeep Arora - Printed on - Date - 8th Aug 2022
As a responsible citizen of the country, one must follow some obligations and duties to enjoy this title unanimously. Paying your taxes on time and filing your returns as per the Income Tax authorities is a primary duty among many other responsibilities. Appearances can be deceiving, one may get confused between these two taxation tasks. As a layman, it is easy to assume that you have completed the taxation marathon if you receive income from salaries or interest from bank deposits. Well, both are different obligations and are necessary to be completed in the financial year. Completing one duty does not release an assessee from the other. It is time to understand the difference and importance of payment of your taxes and filing your ITR. The due date is around the corner so it is time to clarify all doubts regarding filing ITR. A taxpayer in India files ITR according to the Income-tax slab rates and the source of Income as given under the Income Tax Act.
Importance Of Filing ITR For The Financial Year 2021-22
An individual files an ITR if his income exceeds the basic exemption limit which changes according to age. All those above 60 years pay tax only if the limit exceeds Rs.2.5 lakhs. Those above 60 and below 80 enjoy exemption up to Rs.3 lakhs, and for super senior citizens, no tax is charged. There are many benefits following filing the tax return even if you earn below the taxable limit.
- Claim Tax Refund- By filing ITR one can claim the benefit of exemption from taxation in case of passive income such as term deposit interest or dividend income. An individual can collect excess taxes through refunds as these instruments are taxable.
- Validating Applications- For validation of applications in various organisations, the crucial document is your ITR. For example in a loan application in a bank, a visa application, insurance policies or the process of obtaining credit cards all these activities run smoothly if you have been filing returns judiciously over a while.
- Claim losses-To claim losses which you propose to carry forward to the subsequent year to adjust against the gains in the subsequent years, it is mandatory to file your return before the due date.
- Avoid Penalties- It is mandatory for some taxpayers to file ITR therefore to avoid hefty penalties it is in the assessee’s interest to file the return in time.
- Residential Proof- There are times when we need to present proof of address in official places then the receipt of ITR works as the proof of address as well as proof of income in most of the places.
Benefits Of Filing ITR For Deceased Individuals
There are unpredictable circumstances in life, if a loved one passes away in the middle of a financial year an ITR should be filed by the legal heir as it acts as proof of income at the time of insurance claim.
Conclusion-Filing ITR Is Important
Now, is the time to understand the difference and importance of paying your taxes and filing your ITR. The due date is around the corner so it is time to clarify all doubts regarding filing ITR. So, act now. As the onus of filing a return lies on the taxpayer, therefore reap the benefits of filing ITR.
