ITR Filing Deadline Nears as Tax Return Offers Easier Loans, Refunds and Five Key Financial Advantages

23 July, 2026
ITR Filing Deadline Nears as Tax Return Offers Easier Loans, Refunds and Five Key Financial Advantages

Winning Bizness Desk

Mumbai.With fewer than 10 days left before the income tax return (ITR) filing deadline, taxpayers are being urged to complete the process well before July 31 to avoid penalties and secure several financial benefits. More than 30 million taxpayers had already filed their returns by July 22 for the financial year 2025-26. While many believe filing is unnecessary if their annual income is below the taxable limit, tax experts say submitting an ITR can prove beneficial even for those with no tax liability.

Small financial decisions today can create major advantages in the future. According to Chartered Accountant Anand Jain, an ITR is much more than a tax compliance document. It acts as an official proof of income, strengthens financial credibility and helps individuals access banking and financial services with greater ease. One of the biggest benefits is that banks and financial institutions often prefer borrowers with a regular ITR filing record while processing loans.

Know What An Income Tax Return Means

An Income Tax Return is a formal statement submitted to the Income Tax Department declaring an individual's income earned during the previous financial year, taxes payable and taxes already paid through advance tax or tax deducted at source. It also determines whether a taxpayer needs to pay additional tax or is eligible for a refund.

Key advantages of filing an ITR include:

  • Builds a reliable financial record for future needs.
  • Makes it easier to obtain home, vehicle and personal loans.
  • Serves as an important income proof for various financial transactions.
  • Helps establish financial discipline even for non-taxpayers.

Timely Filing Helps Avoid Penalties

Missing the July 31 deadline can prove costly. Individual taxpayers with annual income exceeding Rs 5 lakh may have to pay a late filing fee of Rs 5,000, while those earning below Rs 5 lakh may face a penalty of Rs 1,000. Filing within the prescribed timeline also reduces the chances of receiving notices from the Income Tax Department, which now receives income-related information from multiple financial sources.

Taxpayers should also remember that under Section 234B of the Income Tax Act, interest at one per cent per month may be charged if less than 90 per cent of the total tax liability has been paid. Filing returns on time helps avoid such additional financial burden.

Carry Forward Losses, Claim Tax Refunds

A timely ITR filing also allows taxpayers to carry forward eligible financial losses to future assessment years, reducing tax liability later. For instance, losses arising from the sale of shares can generally be carried forward for up to eight years, provided the return is filed within the due date. Delayed filing may result in the loss of this benefit.

Other important reasons to file an ITR are:

  • Enables taxpayers to claim eligible tax refunds.
  • Refunds are credited directly to the registered bank account after assessment.
  • Ensures tax deducted at source can be recovered where applicable.
  • Creates a documented financial history useful for future financial planning.

With the filing deadline fast approaching, tax experts advise taxpayers not to wait until the final days. Even individuals outside the tax bracket can benefit significantly from maintaining a regular ITR filing record, making it a valuable financial habit rather than merely a legal obligation.