Common Myths About Income Tax Returns

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What qualifies you for a tax? You are a citizen of a country who needs to do your part for the country. People often do not understand the benefits and needs of something unless it is made mandatory. And few people think taxes are not a must! Yes, there are a few common myths and misconceptions about taxes and income tax returns. And you can seek the help of a tax consultant to utilize and calculate R&D tax credit. Let us see what the common myths and misconceptions about tax returns and filing are here.

What is a tax return?

The filing of a tax return is the documentation that determines the amount of income made by a person or corporation, the amount of taxes to be paid to the government or government agencies, and, potentially, the amount of taxes to be returned to the taxpayer. One of the main ways that the government makes money is through taxes. The Income Tax Department of India must receive this form, which must be completed and submitted. It details the individual’s earnings and the taxes that must be paid on them throughout the tax year.

Common Myths about Taxes

Let us talk about all the common prevailing myths about taxes. And reading this will leave you in surprise too!

Gifts of money are not taxable.

Does gift count? People often think that the gifts they money-related wedding gifts from relatives, donations to charities, and inheritances are not taxable. All other financial donations worth more than INR 50,000 are taxed. All the gifts are taxable if they exceed the limit.

Interest is exempt from taxation.

Tax deducted at source may be assessed by your bank (TDS). But, depending on your tax bracket, you can still be required to pay tax on interest received from fixed accounts, recurring accounts, and savings accounts.

Students don’t need to pay taxes

Students frequently don’t earn enough to necessitate filing an income tax return and typically earn less than Americans working full-time. According to the most recent data, there were full-time dependent students who had a source of income. if you paid estimated tax payments or had taxes deducted from your pay. You may be eligible for tax credits that could result in a tax refund, including the earned income tax credit, the child tax credit, and the American opportunity tax credit.

People think that e-filing is not required to file taxes electronically. Electronic filing is required, and if you have previously submitted returns for evaluation, When you have to request a refund.

The new employer will take taxes out of your current paychecks if you change positions during the fiscal year without declaring your old wage. However, tax obligations are calculated based on annual total income. Seek the help of R&D tax credit companies.

Conclusion

Having these myths and not paying taxes is not a healthy thing. You should consult a tax consultant company and do your part.

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