I have multiple financial and lifestyle goals in mind when I file my taxes every year. Not that I have a choice – we all know that it is mandatory to pay taxes. But I love the benefits attached to filing my IT returns. We have all seen the advertisements promoting becoming “stress free” by paying taxes on time. Of course, it will make people stress free by escaping legal actions. But I have more immediate and material benefits in mind … lol!
I have these 5 incentives to file my taxes on time and I am sure they will make you want to file your income tax returns right away:
1. Foreign Travel
I am an explorer at heart. ‘Wanderlust’ is my strongest emotion. I feel that one ought to see the beautiful world that God has created. Well, every kind of travel outside of India requires Visas and you can only get one if your tax returns are filed. There, you have it! My number one incentive to keep my taxes all paid up and in order, is to travel!
And between my third pregnancy, childbirth and caring for an infant, the only travel I have managed in the last two years is 1 domestic flight travel and 2 road trips – one my babymoon and two family functions. After being in one place for so long, you can be sure I am not going to leave any formality undone, which will hamper my next travel!
2. Home Loans (and Other Loans)
My husband and I are united in our firm resolve to not go for any loans, be it for property or vehicles. But with a growing family, we have softened our stance. We agree on the need for a bigger house and bigger car. If things turn out as well as we hope for, we might not need any loans. But if they don’t, we don’t see any point in wasting precious years of our lives struggling for space within our home or car. We are mentally prepared to go in for home loans (even if we might need them partially) and/or vehicle loans should the need arise.
Now, none of these would be possible if our tax returns are not paid for the latest financial year. In order to get any loan sanctioned, your regular and timely income tax returns can give you an edge with your credibility.
3. Exemptions for Women
Not that you need any reason to be happy for being a woman but I love to gloat about it to my husband when filing returns. I clearly enjoy a lot more exemptions than him. I am yet to see him not groan when he compares our payable tax amounts – every year!
This is also helpful in tax planning. There are many joint expenses and incomes and we are able to divide them in a way that the higher tax paying individual can claim more deductions and vice-versa. All this makes paying taxes so much less daunting.
4. Saving Money Being a Mom
Being a mom, or a parent, brings with it a lot of expenses, you will think. Although you are not wrong, but it also brings with it some benefits. You can claim the ‘tuition fees’ from the school fee that you pay, as a deduction. You can also save money investing in their PPF accounts. While there are limits on the total amount exempted from tax, PPF gives wonderful returns due to its compounding interest feature. I have opened PPF for all 3 of them and depositing money into their accounts gives me more satisfaction than even a new pair of shoes!
Another way your children can help is by buying health insurance for the entire family. Since both of us are earning and tax paying individuals, we have split the health insurance into parts. My husband has his own health insurance which includes one child. I have my own which includes the other two. The total sum of all 5 of us is included in the tax relief – and we are all insured!
5. Saving Money Being a Charitable Person
I sound vain, right? But I am honestly a very charitable person. While you won’t see me entertaining any roadside beggars, I try to be a responsible citizen of the country AND the world. Together, my husband and I, we donate to various charities from the Red Cross to the Prime Minister’s Relief Fund in India. From floods in our country to Syrian children, we try to do our bit. And all this comes back to us during tax season. We get deductions and exemptions for all of these!
Other than these five incentives that makes me want to rush to file my tax returns, there is also one simple reason why you should pay your taxes on time. Although you can delay paying your taxes, it is a sure shot way of putting your hard-earned money down the drain. That is because of the hefty interest that gets added to your tax. I speak from experience here – a very nasty experience really! When I think about all that I could have done with that money…. Well, never mind that. I re-iterate my point. Paying taxes on time is a great to minimize wasteful expenses in the form of interest. And e-filing taxes has made it so convenient to not come up with excuses!
I hope my experiences and opinions help you in realizing the financial importance of filing your income tax returns 🙂 There are also many more benefits of filing your taxes which you can read here – a very helpful and enlightening article.