In India, filing Income Tax Returns (ITR) can be as mystical as an ancient proverb, but it doesn’t have to be. Let’s debunk some widespread myths that might be holding you back.
Myth 1: “If I don’t earn much, I don’t have to file.”
Reality: Even if your income falls below the taxable limit, filing your ITR can lead to beneficial financial documentation, making it easier to apply for loans or visas.
Myth 2: “ITR filing is too convoluted.”
Reality: With the introduction of e-filing, the Government of India has significantly simplified the process. Step-by-step guides and customer support can help you navigate your tax returns smoothly.
Myth 3: “All my earnings are below the radar.”
Reality: The IT department is more vigilant than ever. With high-tech cross-verification systems, undeclared income is a red flag that can bring unnecessary scrutiny.
Myth 4: “Filing late has no penalties.”
Reality: Delayed filing can result in penalties up to ₹10,000. But if your taxable income is less than ₹5 lakhs, the maximum penalty is ₹1,000.
Myth 5: “I can’t save taxes; the rules are rigid.”
Reality: There are numerous deductions available under various sections of the Income Tax Act, which can significantly reduce your tax liability. Investments in PPF, NSC, NPS, and health insurance premiums can offer deductions up to ₹1.5 lakh under Section 80C alone.
Understanding these truths can demystify the tax-filing process. Filing your ITR is not just a duty; it’s a step towards financial empowerment. So this tax season, arm yourself with knowledge and file with confidence.
