Freshers, Interns, Apprentices, Freelancers and many other people who have less than Rs.2,50,000 yearly income often neglect the need to file their Income Tax Return.
Although it’s not mandatory as per Income Tax Act for individuals to file an ITR if their Gross Total Income for FY2017-18 is less than Rs.2,50,000; however, let us give you 7 good reasons why you must fulfil this moral and social duty on or before 31st July 2018, this year:
1. Bank Loans
We all need bank loans once in a while, be it an auto loan, home loan or personal loan. The first thing that any bank asks you to show is your last few years Income Tax Returns. People who are regular with their Income Tax filing instantly leave a good impression on the credit officer, thereby making the whole loan documentation process hassle-free.
2. Credit Card
Credit Card is a great financial instrument that extends you credit for a certain interest-free period if you pay the balance by the due date and do not fudge with your credit card payments. However, did you know, to get a credit card issued from leading banks you need to furnish your Income Tax Returns based on which your credit card limits are set.
3. Accidental Claims
In Third Party Insurance, the insurance companies need previous three years ITRs to arrive at an amount of accidental claim. (Yearly Income in ITR) x (Life Expectancy of the Deceased) is the general formula to arrive at the claim amount in case of Third Party Accidental Claims.
4. Visitor Visa
To get a visitor visa to countries like the US, UK, Canada and alike, you must furnish past Income Tax Returns along with other financial details. Your Tax-Compliance does get you extra brownie points during visa processing.
5. Past Losses
Lastly, if you have been otherwise filing returns and paying Income Tax, but for a particular year your Income is low and you’ve incurred losses, it is important to file ITR and bring these financial losses in the notice of the Income Tax Department, as the same can be claimed for adjustment in future.
6. VC Funding
All Startups need funds to grow and expand. If you’ve just sailed your startup dreams and currently are working as a freelancer/solopreneur, then you must file your ITRs because by the time you’ll be going for your Funding pitches in a year or two, your ITRs will be the first things demanded by Angel or Venture Capital Investors.
7. Judicial Interviews
In Judicial Interviews seven years of ITR records are checked to establish a candidate’s credibility. On similar lines, interviews for the post of CA, Lawyer, or Senior Auditor too should be backed by your Income Tax Returns for the past few years.