Taxpayers with total gross income below the exempted limit of Rs 2.5 lakh are not required to file ITR. However, every individual must file the return of income if his/her total income exceeds the maximum exemption limit.
If a resident individual's income is higher than the exemption limit in a financial year, then the person is asked to file a tax return.
The maximum exemption limits for individuals are:
⦁ Rs. 2.5 lakh for an individual
⦁ Rs 3 lakh for senior citizens (age 60 years or more but less than 80 years)
⦁ Rs 5 lakh for resident super senior Citizen (age 80 years or more)
If your total gross income may exceed the basic exemption limit but due to various deductions, the taxable income may come down below 2.50 lakh and then there’s no liability to pay any tax.
Why should you file your ITR returns?
Even if your taxable income falls under the exemption limit, you should still file a return. Such a return is called nil income-tax return (ITR). Filing it conveys to the Income-Tax department that you did not pay tax that year as your income was low.
Filing of return is mandatory in the following cases:
1. ITR filing is mandatory if your TDS, TCS is Rs 25,000 or more
The income tax department has specified that individuals whose total TDS/TCS (tax deducted at source/tax collected at source) in the financial year are higher than Rs 25,000 and Rs 50,000 for senior citizens, need to file their ITRs.
2. If the aggregate deposit in one or more savings bank accounts of the person is Rs. 50 lakhs or more during the previous year.
READ | ITR for AY 2022-23: Five benefits of filing income tax returns on time
