The idiom “The sooner the better” is also true for tax return filing. However, we Indians being serious procrastinators, don’t actually believe one bit in it. We enjoy completing things at the last moment without realizing the consequences.
Most of the tax return filers have all the information required for filing their income tax return in the months of May-June itself. But they wait till the last date, i.e., 31st July, braving all the trouble caused due to slow servers and last minute rush.
It is not just the last minute trouble that you avoid by filing your tax return early. There are many other benefits that you get when you file your return well before last date:
- Loss of Interest on Refund: Income tax refund is credited to bank account only after e-filing. Moreover, any interest accrued on refund is also calculated from the date of e-filing. Hence, the later you file the return, the more you lose the interest on refund. Don’t delay anymore, Start e-Filing Now!
- Additional Interest Payable on Tax Due: After the return filing due date, the income tax department charges interest at the rate of 1% for every month of delay. This is more important for those who had changed job during the last financial year or had income other than salary, viz, interest of Fixed deposit, saving account, capital gain on sale of property, shares etc. In these cases, there are high chances of additional tax also being due.
- Notice and Penalty of Rs. 5000 for Late Filing: You may get slapped with penalty notice if you miss the e-filing deadline, which 31st July, 2017 this year. Don’t delay anymore, Start e-Filing Now!
- Carry Forward Losses: You can carry forward this year’s losses to the next 8 years, if the return is filed before 31-July-2017.
- Consult with a Tax Expert: You get time to consult with a consult with a tax expert to claim all such deductions that you might have missed out declaring to your employer or your employer might have missed out while computing your tax and issuing Form 16.
- Reduce Taxes for Current FY: While filing last year’s return, you also tend to notice the high taxes paid by you in the last year. You can’t do much about your last year’s taxes now, but you should not wait anymore to save taxes this year. In case you delay further, the scope of tax saving would keep on reducing. This is the right time to work upon your tax savings for FY 2017-18 and accordingly plan your investments. You can avail the combo package of ‘File & Plan Tax’ to file your last year’s return and simultaneously save tax for this year.
- Apply for a Visa or a Loan: Tax returns are required to be furnished in order to apply for a loan or visa. It is a good idea to have your tax compliance completed well in time for such needs.
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