Zero Tax Liability? 5 reasons why filing an ITR still benefits you
Filing a zero tax return could turn out to be a benefit as well. Here are the 5 benefits of filing a zero tax return for taxpayers. From being perceived as a responsible taxpayer to having sound financial documents, the benefits are many. Read it to find out
New Delhi: The Income Tax Return (ITR) filing season is ongoing. The session will get over by September 15, 2025. Taxpayers are scrambling over saving taxes, while those who do not come under any tax liability believe there is no need for them to get bothered. However, there lies a small catch. Even if one does not come under any tax liability, filing an ITR comes with a lot of benefits.
In the new tax regime, there exists NIL tax on annual salaries up to Rs 4 lakh, meaning no tax liability for people earning up to Rs 4 lakh. Filing ITR in that income scale attracts a lot of benefits. The benefits are as follows:
1. Reliable Financial Proof
ITR works as a valid and authentic financial document proof. Whether one applies for a visa or for a loan, ITR can be used as a valid document. If one is planning to travel abroad and, in that regard, applying for a visa, one will be asked for proof of income. Or even if one applies for a home loan from a bank, one has to furnish an ITR document. The ITR document clearly shows the financial history, which streamlines the further process and increases the credibility.
2. TDS Refund
If the salary is not taxable, yet the banks deduct TDS on the interest earned on an FD (fixed deposit) or on a savings account. Filing an ITR would get one the deducted amount as a refund. For example, suppose one earns an interest of Rs 10,000 on an FD and the bank deducted 10% TDS on it. If the total income is less than the taxable limit, then the concerned money could be claimed by filing an ITR and claiming a refund. Without filing an ITR, it is difficult to get the refund.
3. Loans and Credit Card Accessibility
Banks or financial institutions ask for ITR while giving loans or credit cards. If one claims that their salary does not come under the tax net, then the bank will not process further based on the verbal statement. But if one files an ITR regularly despite having zero tax liability, then the bank considers them a responsible taxpayer. This increases the chances of getting a home loan, personal loan, or credit card. Especially if the credit score is low, then ITR can prove to be a game-changer for them.
4. Managing Losses
Suppose the salary does not come in the taxable range, but then one has invested in the stock market or mutual fund. Now what happens is in the middle of the year, one sold some shares and incurred a loss while simultaneously getting a salary hike in the next year. Under the hiked salary, one now comes under the income tax liability. If one filed an NIL ITR last year, then the individual can carry forward the loss to the next financial year. This can reduce the taxable income and reduce the tax burden. Just in case one did not file an ITR last year, then this opportunity would be lost.
5. Showing Taxpayer and Financial Responsibility
Filing ITR is not just a way to save tax but also a way to fulfill many future needs. Whether applying for a passport or visa, taking a loan, or taking a major financial decision, ITR always comes in handy. This is a document that reflects your financial responsibility. If you file ITR regularly, many doors can open for you in the future.
Why is ITR necessary?
Filing ITR is not just a formality, but it is a way of making the financial journey easier. It is proof of being a responsible taxpayer and citizen. Whether it is taking a loan, applying for a visa, or claiming a refund, ITR is something that always comes in handy. File an ITR and avail these benefits