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Filing income tax returns (ITR) is one of the most important financial responsibilities for salaried individuals, professionals, and even certain non-salaried citizens. Yet, despite constant awareness campaigns, many myths and misconceptions continue to surround the process. From assuming that missed deadlines end your chance to file, to believing that every gift is taxable, taxpayers often fall prey to half-baked information.

As the Income Tax Department gears up for ITR Filing 2025, it’s time to clear the air. Here are six common myths about income tax returns—and the facts you should know before making mistakes that could cost you money or peace of mind.

Myth 1: If You Miss the Deadline, You Can’t File ITR

Many people panic if they miss the official ITR deadline, thinking they’ve lost their chance forever. The truth is, the government allows taxpayers to file a belated return even after the due date. While a penalty may apply, it’s still better to file late than not at all. Filing ensures compliance, protects you from notices, and helps you carry forward certain losses.

Myth 2: Gifts Are Always Taxable

It’s a common belief that gifts are automatically taxable. In reality, the Income Tax Act exempts gifts received from specific relatives such as parents, siblings, or spouses. Similarly, gifts received on certain occasions like marriage are also tax-free. Only gifts above a specified threshold, when received from non-relatives, attract tax under “Income from Other Sources.”

Myth 3: Only the Salaried Need to File Returns

Many self-employed individuals or those with irregular income streams assume ITR filing is only for salaried employees. This is incorrect. If your total income exceeds the basic exemption limit, you must file a return regardless of your profession. In fact, even individuals with no taxable income sometimes file returns voluntarily to maintain a record for visa applications, loans, or future compliance.

Myth 4: No Need to File ITR if TDS Is Already Deducted

Some taxpayers believe that if their employer or bank has already deducted tax at source (TDS), filing a return becomes unnecessary. This is a dangerous misconception. Even if TDS is deducted, you may still be eligible for refunds, or you may have additional income from sources like rent, interest, or capital gains. Filing an ITR ensures accurate tax calculation and refunds, if any.

Myth 5: Only Those With High Income Are Monitored

Another myth is that the Income Tax Department only tracks high-net-worth individuals. With advanced data analytics and digital reporting, the department now keeps an eye on transactions of all sizes. Large deposits, high-value purchases, or even frequent stock trades can trigger scrutiny. Hence, compliance is crucial for everyone, not just wealthy individuals.

Myth 6: Filing ITR Is Voluntary for Everyone

Some people think filing ITR is optional, like a personal choice. In reality, filing is mandatory if your income crosses the exemption limit, if you hold foreign assets, or if you make certain high-value transactions during the year. Non-compliance can lead to penalties, interest, and even legal consequences.

Final Thoughts

Understanding the truth behind these myths is essential for smooth and stress-free ITR Filing 2025. Filing your return on time not only keeps you compliant but also opens doors to tax refunds, easier financial approvals, and legal protection.

If you’re unsure about the process, consult a certified tax professional or use official portals like the Income Tax e-filing website. Don’t let misconceptions dictate your financial decisions—get the facts right, and file smart.