ITR filing is mandatory

ITR filing is Mandatory | 10 reasons why we must file Income tax return in following situations

Section 139 lists certain situations where in ITR filing by an individual is mandatory even if no tax has been deducted from his income or even if he does not earn any income. Recently, a few more situations have been notified wherein return filing is mandatory.

 

Section 139 of the Income Tax Act governs the filing of a return of income. A common understanding is that the obligation to file an income tax return (ITR) arises if an individual earns income on which tax has been deducted.

This is not entirely true. Section 139 lists certain situations wherein return filing by an individual is mandatory even if no tax has been deducted from his income or even if he does not earn any income.

Recently, the Income Tax Department has enhanced the scope of this provision and notified a few more situations wherein return filing is mandatory.

we have listed all those possible situations which require an individual to furnish his return of income for the Financial Year 2021-22 (Assessment Year 2022-23).

 

ITR, ITR Filings, Income tax return
ITR filing is Mandatory

10 reasons why must we file Income tax return, ITR filing is Mandatory as per recent few more situations have been notified wherein return filing is mandatory.

1) If your total income exceeds the basic exemption limit

An individual shall file the Income Tax return if his income exceeds the maximum exemption limit. The maximum exemption limit for individuals is:

⦁ ₹ 2.5 lakh for an individual;
⦁ ₹ 3 lakh for resident senior citizen (age 60 years or more but less than 80 years) and
⦁ ₹ 5 lakh for resident super senior Citizen (age 80 years or more).

The following deductions and exemptions available to an individual shall not be taken into consideration to calculate such maximum exemption limit:

⦁ Exemption from capital gains under section 54, 54B, 54D, 54EC, 54F, 54G, 54GA or 54GB.
⦁ Deduction under Section 80C to 80U.

2) If you have assets outside India

It is mandatory for an individual to furnish a return of income if he:

⦁ holds any asset (including any financial interest in any entity) located outside India (as a beneficiary or otherwise);
⦁ has signing authority in any account located outside India; or
⦁ is a beneficiary of any asset (including any financial interest in any entity) located outside India.

This provision shall apply to resident and ordinary resident individuals in India.

3) If you deposit more than ₹ 1 crore in a bank account

An individual shall file his return if he has deposited ₹ 1 crore or more in one or more current accounts maintained with a bank during the previous year.

No reference has been made for the deposit made in the current account maintained with a Post Office. Thus, if an individual is depositing more than ₹ 1 crore in a current account with a post office and his income is less than the maximum exemption limit, he may not be required to furnish his return.

4) If you incurred ₹ 2 lakh on travel to foreign country

An individual will file his return if he has incurred more than ₹ 2 lakh on travel to a foreign country, either for himself or for any other person during the previous year.

5) If your electricity consumption is ₹ 1 lakh in one year

An individual shall file his IT return if he has incurred more than ₹ 1 lakh on electricity consumption during the previous year.

6) If turnover of your business is more than ₹ 60 lakh

An individual must file his return if total sales, turnover, or gross receipt of the business exceeds ₹ 60 lakh during the previous year.

7) If gross receipt from profession is more than ₹ 10 lakh

An individual shall file his ITR if the total gross receipt of the profession exceeds ₹ 10 lakh during the previous year.

8) If TDS and TCS is ₹ 25,000 or more

An Individual (age less than 60 years) is required to file his return if the aggregate amount of tax deducted at source (TDS) and tax collected at source (TCS) in his case during the previous year is ₹ 25,000 or more.

9) If TDS and TCS is ₹ 50,000 or more

The threshold limit of ₹ 25,000 shall be considered as ₹ 50,000 in the case of resident senior citizen, i.e., whose age is 60 years or more at any time during the relevant previous year.

10) If deposit in a saving bank account is ₹ 50 lakh or more

An individual shall file his return if the aggregate deposit in one or more savings bank accounts is ₹ 50 lakh or more during the previous year.