We have heard many a times that every individual whose total income exceeds the maximum exemption limit is obligated to furnish his/her Income Tax Return or ITR. But what is the benefit of filing ITR – especially for those below 30 years of age or those not in the higher tax bracket? Why should any person voluntarily go and submit his income details to the tax authority? Isn’t it more logical not to disclose income details and avoid paying tax altogether?

TaxYogi believes that there are some solid reasons (listed below) for acquiring a PAN card (if you don’t have one) and filing your ITR within the due date, i.e 31st July every year:

• Standard Income Proof – ITR is considered a customary income proof not only in India but also globally. If you are looking for higher education or employment abroad, ITR is the largely accepted income proof.
• Speeds your loan application process - Apart from a good credit history (or past repayment track), the fact that you are filing your ITR regularly gives you speedier access to credit and at better terms – although not necessarily a larger line of credit, but surely a better rate. It also provides the impression to the financier that you are a law abiding citizen and will repay the loan within time.
• Power of PAN – Permanent Account Number or PAN issued by the IT authority is not only a prerequisite for filing ITR but is also now mandatory for all financial transactions – from opening a bank account, or purchasing mutual funds to real estate for investment. So it makes sense to get yourself one even if you don’t have much income to boast of.
• Claim your Tax refund – Filing ITR is not always about paying tax. It can be used as a means to reduce your tax liability! Yes, you heard us right. Take for instance, salaried employees for whom TDS has been cut during the financial year can claim refund if the tax outgo has been more than the actual tax payable.

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