Suppose you want to apply for a home loan or any other loan (other than mortgage). In most cases, a lender will ask for income proof before sanctioning a loan. The process will include submitting your income tax returns for the last two or three financial years.

If you have incurred losses under the heads “Capital Gains” or “Profits and Gains from Business or Profession” and want such losses to be carried forward to the next financial year, you can do so only by filing your income tax return.

If your employee deducts tax at source or you have a contractual agreement that invites TDS, you can claim a deduction for the same by filing your income tax return for the year within the deadline (July 31 or as declared of the succeeding year). In such cases, the income tax department calculates your net tax liability after adjusting the TDS paid. If you are not required to pay tax, you can claim a refund by filing your ITR. You can track your refund by checking your income tax return status.

Any amount you pay as tax helps in building your nation. For FY21, the government collected more than ₹ 12 lakh crore as direct taxes. The government can use the amount for building infrastructure or for other developmental activities.

If you are applying for a visa for an international trip or a credit card, the issuer will demand income proof from you. In most cases, you are required to submit your income tax returns for the last three years. It will help the other party ascertain if you are eligible for a visa or a credit card. If you intend to visit countries like the USA, Canada, or any part of Europe, you must submit your ITRs during the verification process.