ITR Filing Is Mandatory Even Below the Taxable Income Limit in These Cases:

Many people believe that if their income is below the basic tax exemption limit, they are not required to file an Income Tax Return (ITR). Many lower income earners believe they don’t need to file a return as a result. But it’s a bit more complicated than that.

The filing of an ITR is not income-based alone. The Income Tax Department also keeps a tab on certain financial activities like high-value transactions, foreign assets or income and certain spending patterns. In some cases, these factors may make it a requirement to file ITR even when no tax is payable.

Taxpayers should know these lesser-known rules before deciding whether they need to file a return. Knowing these conditions will help them avoid penalties and be compliant with tax laws.

Filing an Income Tax Return (ITR) is mandatory

High TDS or TCS: If the total amount of Tax Deducted at Source (TDS) or Tax Collected at Source (TCS) during the year is more than Rs 25,000 (or Rs 50,000 for senior citizens), you are required to file an ITR.

Deposits in savings account above Rs 50 lakh: But if you deposit more than Rs 50 lakh in your savings account(s) during a financial year, you will have to file an ITR even if your income is below the taxable limit.

Foreign Assets or Investments: If you are an Indian Resident and you own any foreign assets or investments (such as foreign bank account, shares abroad or property abroad), you will have to file an ITR even if these do not generate any income.

Deposits in current accounts of Rs 1 crore and above: You will need to file an ITR if you deposit Rs 1 crore or more in one or more current accounts in a financial year. This rule does not apply to businesses.

Bill for electricity over Rs 1 lakh : If the total bill of electricity in a financial year is more than Rs 1 lakh, then you need to file an ITR.

Professional income over Rs 10 lakh: If you are a freelancer or a professional and your total receipts from your profession exceed Rs 10 lakh in a financial year, you need to file an ITR. The Rs 10 lakh limit is calculated on your total earnings without any deduction of expenses.