Why Is Income Tax So Important?

Category: Finance


An income tax is a tax that states tax on income generated by businesses and people within their field. By law, taxpayers must record an income tax return periodically to manage their tax responsibilities. Income taxes are a reference to revenue for governments. They are used to finance public services, pay government obligations, and produce goods for citizens.



Most people seem to think that filing tax returns is optional and therefore dismiss it as unnecessary and burdensome. As we will discuss, this is not a very healthy outlook on tax-filing. Filing tax returns is an annual project viewed as a moral and social duty of every loyal citizen of the country.


It is the source for the government to restrict the amount and means of expenditure of the citizens and presents a platform for the assessee to claim a refund, among other methods of relief from time to time. If you have any issues in income tax you can clarify by visiting Income tax consultants in Hyderabad.

When Is A Taxpayer Eligible To Receive A Refund?

  • An income tax refund is due to a taxpayer if he has paid taxes higher when related to his actual tax liability. There are several inferences which could lead to this kind of a scenario. Some of these have been listed below :
  • The employer usually deducts taxes after taking into consideration various documentary proofs given to him by an employee about say 80C investments etc. However, there are conditions where an employee is not able to furnish evidence for few such investments before the end of a particular financial year, and therefore the employer goes ahead with a higher deduction. However, the advantage of such investment can be claimed by the employee while filing his return of income and therefore require a refund of the higher taxes paid;
  • Some individuals may not fall within the taxable bracket at all, i.e., their income would be limited than Rs 2.5 lakhs. Hence, they would not have to pay any taxes. Yet, taxes would have decreased on their income. This being so, they can demand a refund of the excess taxes deducted.
  • Taxpayers may be called upon to pay extra taxes by their income-tax officer following certain additions made to their income when income tax proceedings. Appeal authorities may remove such additions. Accordingly, the taxpayer will be paid the taxes he would have paid. You have different services on online services like accounting services in Hyderabad with this income tax services. If you have any issues on this both you can visit online services.


How Much Of A Refund Is Due To A Taxpayer?

Refund Claimed In The Return Of Income:

When a taxpayer requires a refund in his return of income, the tax department rules such return, and the taxpayer would receive an intimation from CPC under Section 143(1) which will confirm the quantum of the refund that the taxpayer is qualified to receive. The refund can either match with, or it could be higher / lower than what is required in the return of income. This refund amount is what the taxpayer would ideally get from the income tax department; 


Refund Due After Deletion Of Additions By Claim Authorities:

Once the appeal authorities remove the additions, the income tax officer, by an order, defines the refund due to the taxpayer. This is what the taxpayer will be qualified to receive.

How To Check For Refund Status?

Once the refund is defined, the same will be processed by the tax department.

The status of refund can be checked either from :

  • The income tax e-filing portal or
  • The NSDL website