If you think that filing income tax returns (ITR) are not relevant to you because you are not permanently employed with a company, this post is for you. Let’s begin by asserting that you are employed; you are self-employed. And believe it or not, whether you fall in the tax bracket defined by the laws or not, filing ITR as a freelancer gives you some cool advantages. Let’s look at a few of them:
1) Easier approval of loans: Deciding to go solo and be your own boss has some huge pluses but is not devoid of minuses. Something as normal as applying for a loan can be difficult. Here’s where your ITR becomes your savior. Filing ITR can prove useful when you apply for a car loan, a business loan, or even a home loan. Every financial institution that you approach for a loan would need a proof of income, and your ITR is just that.
2) Claiming tax refunds: If you’re dealing with a corporate client, they are most likely to deduct TDS (tax deducted at source) from your earnings. It’s normal for you to feel the pinch in such cases, but the good news is that you can get back what you lost. Why lose out on something that you deserve, right? Well, all you need to do is file your ITR every year.
3) Quicker processing of visa: One of the perks of freelancing is the freedom to work from anywhere in the world, literally. You would never want your overseas travel plans to get disrupted, and the last thing you want is for your plans to get affected because your visa didn’t come through. The visa application process for a freelancer can be a herculean task. Most embassies and consulates will not issue you a visa if you do not provide copies of your tax returns for the past two years from the date of application. Do not miss out on a workation, or a dream project for that matter because of not filing your taxes.
4) Avoid unnecessary penalties: On the off chance that you are required to file your returns and you do not, you are inviting tax penalties. You could be facing a monetary fine of up to Rs. 5000 for not filing ITR, and we know you do not want that. If nothing else, at least the fear of litigation should push you to file ITR.
So, if you are a freelancer and you haven’t considered filing ITR, think again. If you’ve stayed with us throughout this piece and have reached here, you now know what’s in it for you. If you want to know more about how you can file your returns, reach out to us via DM on Instagram.