Is there any Benefit of Early ITR filing..? Yes.! there are not one but Many. Your ITR (Income Tax return) gives a legal sanction to your income. Filing your ITR early, i.e. before due date saves you many hassles, which you may have to face as consequences. Yet, the benefits of early ITR filing are in multiples.
Early ITR filing doesn’t only make you a responsible citizen but it also ensures smooth governance. There are benefit of Early ITR filing. The due date for filing the return for FY 2019-20 for individuals has been extended to 30 Nov 2020. If you have a business and you are required to audit the book of accounts, then the due date is 31st Oct 2020.
Although the due date is still a few months away, Yet there are some Big Benefits of early ITR Filing.
1) Avoid the hassles of late return filing – Filing a return is not like shopping online. It requires a compilation of documents and information. And of-course a certain amount of care and diligence while filling up the form. So, your ITR Early will save you tonnes of troubles later. You may need to rectify and revise your return later if you do it at the last minute.
2) Carry forward of losses – The losses, if any incurred by you, from your Business or Profession or from Share Trading, both speculative and non-speculative as well as capital losses under the head “income from capital gains” can be carried forward. However, one can claim this benefit only if they have filed their income tax return before the due date. Filing your tax return early will eliminate the chances of losses not being carried forward. If your losses from share trading run into lacs, then This is a big Benefit of Early ITR filing.
Gear up Taxpayers! Collect all Information and Documents and file your ITR as early as possible.
3) Earlier e-verification of your return filed – The Income Tax Department has brought many much-needed modifications in filing procedures. One such advancement is the e-verification of the ITR filed. The earlier you file your return, the sooner you get the verification done.
4) Faster processing of refund – Yes, your Tax has been deducted in Excess and you are eager to get your money back. But you can only get your refund of Income tax .. only when you file your ITR early. The sooner you file your ITR …. The sooner you get your Refund … It’s simple. if your Refund due is in lacs… can there be any bigger Benefit of Early ITR filing than this one..?
5) Save yourself some interest – If you fail to file your income tax return before the due date(,) then you will be obliged to pay interest u/s 234A at the rate of 1 percent for every month or a part thereof.
ALSO READ: So what changed in ITR form 2020…?
6) Avoid the defective return notice – To err is a human tendency. Chances of mistake increases, if you file your return just around the due date. The tax officer may issue a defective return notice under section 139(9) of the Income-Tax Act, asking for the proof/ justification for the mistake and mismatch and the failure to respond can result in heavy penalties.
7) Avoidance of dreadful fee – Under section 234F of the Income-Tax Act, if a person required to furnish a return of income by July 31 fails to do so, then a fee of Rs. 5000 shall be levied if a return is furnished before 31st December. However, the fee shall be Rs. 10,000 if it is filed after 31st December.
8) Get Loan / VISA Quickly – Banks and other non-banking financial institutions require your income tax returns to process home, educational and other types of loans. It is also mandatory to have income tax returns for the processing of any visa. Also, some credit card companies demand proof of tax returns before issuing a card.
9) Registration of immovable property – Some states require your income-tax return of the last three years for registration of immovable property. Also, a legal sanction to income whether taxable or not helps you pad up subsequently to account for the wealth or the property owned.
10) The last-minute surge can be avoided – Remember what happens when everyone tries to book a cab at the same time. Yes, there is a surge in the fare. Similarly, high traffic on a website can often lead the site to face a temporary break-down. In such a scenario, you may not be able to file your return on time. In order to avoid this last-minute unorganized chaos and compliance hazard, file your return by taking a suitable buffer in hand.