Filing of Income Tax Return - 1

ITR-1 form is also known as Sahaj form. Sahaj is a Hindi word that means easy. It is an income tax return form for any salaried individual having total income up to INR 50 lakh. That means any person receiving a salary, pension, interest on house property, or have any other sources of income up to INR 50 lakh must file ITR-1.

For individuals having income up to INR, 5 thousand from agriculture will also have to file ITR-

1. As per the income tax department, ITR form for taxpayers creates a simple tax compliance structure. Therefore, you must furnish your return as per your income.

Note: 

it is now mandatory to furnish your Pan and Aadhar card details on the income tax department's official website. 

ITR-1 is a form that should be filed by all the taxpayers who have income up to INR 50 lakhs. The eligibilities to file ITR-1 are:

1) If any individual incomes from any one house property

2) The source of incomes is either salary or pension

3) If any individual incomes from any other sources

4) If the combined income of minor or wife is shown, you can file ITR if your income is as per the above points.

5) Agricultural income up to INR 5 thousand

1. ITR receipt is a precious document

When you file your income tax returns, the income tax department provides you a receipt in return. This receipt is a precious document. It contains more detailed data as compared to Form 16. Thus, filing your income tax returns helps you record all your taxations with revenue from different sources.

2. ITR receipt serves as address proof

When an individual files his/her income tax returns, the IT department sends the receipt to the registered address of the person/ entity. Thus, it serves you as your residential proof. You can show it as your proof of address in organizations like banks and NBFCs. 

3. Easy processing of bank loans

Filing your income tax returns offers you various benefits to avail loans. One such is easy processing of bank loans. When you apply for a bank loan, the bank will verify your eligibility. Thus, filing income tax returns makes it easier for you to avail any loan. The returns act as a strong document. It shows the poof of income to the loan provider. 

Whether it is a house credit, personal mortgage, or vehicle loan, you can show provide the copies of your ITR statements for easy processing of the bank loans.

4. Compensation of the losses in the next financial year

Until you file your income tax returns, you cannot compensate for your losses to the next financial year. According to the IT Act, if you do not file your income tax returns on time, your losses will not be adjusted. You cannot compensate losses for the next financial year. Thus, to ensure that you compensate your losses, you must file your Income-tax returns on time. 

5. Avoid extra interests

If you don’t file your income tax returns on time, you will be liable to pay extra interest 1% on the tax as a penalty. This penalty shall keep on adding until you file your returns. For example, a bank deducts taxes at source from the interest of the fixed deposit. In order to claim the refund of the TDS, you must file your taxable income. In case you don’t file your returns then you have to pay extra interest on the deposits, 

6. Avoid penalties

As per the IT Act, if an individual doesn’t file income tax returns on time, he/she will be held liable to pay the penalty up to INR10, 000. and this penalty shall keep on adding until you file your returns.

7. Easy credit card processing

When you apply for credit cards, the banks usually verify your income tax returns. So, if you don’t file your income tax returns, the bank may reject your credit card application. 

8. Hassle-free visa processing 

Sometimes the Visa Authorities may ask you the documents of your past tax returns. Thus, if you are applying for Visa, you must file your income tax returns on time. Filing the IT will eliminate all the hassles in Visa applications. You can get a Visa easily. 

9. Helpful for the freelancers and independent professionals 

The individuals who are independent professionals or freelancers don’t have form 16. Thus it might get difficult for them to avail of any financial benefits. Income tax returns are the only document that shows the proof of income for them. Thus, if you are freelancers or independent professional, you must file you ITR without wasting time. It will eliminate the funding issues and transactional problems.

1. Interest loss on refunds: 

When you file for a refund in your tax returns that you paid in advance, you will lose some interest in filing your ITR late

2. Losses will not carry forward: 

If you file ITR-1 after the due dates, your losses will not be carried forward except house property losses.

3. Penalties: 

Filing the ITR late also results in a penalty of interest 1% per month. The penalty starts from the due date and continues until you make the payment.