Filing a NIL income tax return is not mandatory if your total income is below the basic exemption limit as per the Income Tax Act. But it is always recommended that you file an ITR if there is any source of income earned by you in a financial year.
If you are finding the task tedious, then stop worrying. The process of filing for NIL tax is pretty much similar to that of a normal return filing. No separate process is required. Filing NIL return is helpful in many ways.
Read Also: Easy Guide of Filing I-T Return 1 by Gen IT Software
Top Benefits of Filing Nil ITR
The details are listed below about why should file a nil income tax return by the Indian people?
To Claim a Tax Refund
Sometimes TDS is deducted from the income (say Interest on Bank FDR) earned during an FY even if the total income is below the basic exemption limit. To claim such TDS deducted, it is mandatory to file an income tax return.
Authentic Proof of Your Income
A NIL ITR serves as the legal document giving all the necessary details of your financial status. Besides, it is considered solid proof of income and is accepted by each and every financial institution.
Applying for VISA
A NIL return proves to be handy when it comes to a VISA application as showing proof of income is also a part of the whole applying procedure. For instance, it is compulsory to show the returns filed over the last three years while applying for a Schengen Visa, even if you didn’t have any income.
A Legal Proof While Applying for Loans
Again a legal document while applying for a car, home loan etc. Bankers have a quite common practice of asking for the last three to five years of tax returns while granting any kind of loan. A NIL tax return would help you out in such a situation.
Recommended: Free Download ITR Filing Software for Full Version
Set Off Loses
Filing a return even NIL is mandatory if you’ve suffered any stock market loss and want to carry forward it to the next year. Moreover, regardless of the fact whether you are earning any income or not, you should realize the instances when to file a return. As per the income tax rules, if an individual holds a foreign asset even if not earning any income, must file the return, noted Agarwal.
Filing income tax returns ensures financial stability, which is very necessary for our future sake.
