The ITR or income tax filing is a crucial annual financial task that needs to be taken care of by many salaried and self-employed professionals. The income tax filing season for 2024-25 has started. If you earn above a certain limit, you need to file your tax returns. Filing income tax returns can be confusing, and many people believe wrong things about it. Let’s clear up five common myths so you can file your taxes correctly and avoid mistakes. 

1. Debunking the Myth: Investing in tax-saving schemes is optional

Reality: While not mandatory, investing in Section 80C schemes (like PPF, ELSS, LIC premiums) can significantly reduce your taxable income. By not utilising these deductions, you might end up paying more tax than necessary. Planning can help you save up to Rs 1.5 lakh under Section 80C alone.

2. Myth-Busting: If my employer deducts TDS, I don’t need to file ITR

Reality: Even with TDS deductions by your employer, filing your Income Tax Return (ITR) is mandatory if your gross income exceeds the basic exemption limit. TDS is just an advanced tax collection mechanism. Filing ITR helps you:

• Claim refunds
• Carry forward losses
• Fulfill your tax obligations

3. Myth: Only the rich need to pay income tax

Reality: Income tax applies to anyone whose annual income exceeds the exemption threshold, regardless of their profession or source of income. This includes:
Salaried individuals

• Freelancers
• Small business owners
• Investors

4. Myth: I can’t file ITR if I missed the deadline

Reality: You can still file a belated return up to December 31 of the assessment year. However, be aware that:
Penalties and interest may apply
It’s best to file as soon as possible to minimise additional costs

5. Myth: Gifts from family and friends are always taxable

Reality: Gifts received from specified relatives, such as parents, siblings, or a spouse, are completely tax-free under Section 56 of the Income Tax Act, regardless of the amount. However, gifts from non-relatives are tax-exempt only up to Rs 50,000 in a financial year. If the total value of gifts from non-relatives exceeds Rs 50,000, the entire amount becomes taxable in the hands of the receiver