Income Tax Return
Who Should File Income Tax Return
Every person needs to file income tax return under section 139 of the Income Tax Act, 1961. The income tax return is a statement of income of a person declaring all the sources of revenue and the taxes paid on the income. It also states the deductions, if any, claimed by the individuals. The Income Tax Department scrutinises the income tax return to identify fraud or misstatement of revenue. The income tax returns are different for different people, such as ITR-1 is for the individuals and HUFs having income other than business and profession income, ITR-4 is for the firms, Association of Persons and Body of Individuals, etc.
Income tax return is filed yearly by a person. It is regarded as a duty and responsibility of a person as a real Indian. It highlights the expenses along with the revenue and thus helps in claiming refunds if any. Additionally, income tax return can be useful in obtaining loans or credit cards quickly and smoothly. It helps in filing the revised return when needed. Adjustments of the past year's losses can be easily claimed if returns are properly filed. Any failure to file return or pay tax may give rise to penalties.