What is ITR Filing
Income Tax Return is the form in which an assessee files information about his Income and tax thereon to Income Tax Department. Various forms are ITR 1, ITR 2, ITR 3, ITR 4, ITR 5, ITR 6 and ITR 7. When you file a belated return, you are not allowed to carry forward certain losses. hese returns should be filed before the specified due date. Every Income Tax Return Form is applicable to a certain section of the Assessees. Only those Forms which are filed by the eligible Assessees are processed by the Income Tax Department of India. It is therefore imperative to know which particular form is appropriate in each case. Income Tax Return Forms vary depending on the criteria of the source of income of the Assessee and the category of the Assessee.
Why it is essential
It is essential to file returns when your income crosses/exceeds the basic exemption limit even if it means that on account of you investment planning, your tax obligation may be nil. So for FY 2009-10, filing of tax returns is essential if:
1. Individuals have taxable income exceeding Rs.160,000 p.a.
2. Women have taxable income exceeding Rs.190,000 p.a.
3. Senior Citizens have taxable income exceeding Rs.240,000 p.a.
What is that you need to know
Filing returns or not has never been a choice. It is a legal obligation which should be fulfilled by everyone who falls under the prescribed category. However, if you still needs more reasons to file your returns, here are a few: a) To avail home or personal loans.
b) For visa and immigration processing.
c) It is an income proof or a net worth certificate.
d) For claiming excess tax paid via refund
e) Applying for a higher insurance cover