Who needs to File Income Tax Returns (ITR) in India for FY 2023-24?
The Indian Income Tax Law under the Income-tax Act, 1961 provides the details about the compulsory filing of income tax returns by individuals.
As per the income tax laws, it is mandatory for individuals to file an ITR if the total income earned during the year exceeds the exemption limit.
There are other provisions of the Income Tax Act, where ITR filing is mandatory even if the Income is less than the Exemption Limit.
Most people know that to avoid penalty one has to file the income tax return (ITR) whenever the taxable income is more than the IT exemption limit. Income tax laws regarding ITR state that filing of return is compulsory in certain situations irrespective of the fact that the taxable income is less than the minimum limit.
Section 139 of the act clearly states that even though one is an individual and his/her total income for a specific financial year is below the basic exemption limit still he/she has to file an ITR in certain circumstances and in case the same is not filed by July 31st then penalty will apply to such taxpayer.
Below are the circumstances in which one is required to file an ITR even though the total taxable income is less than the basic exemption limit:
1. Holding Foreign Assets or Foreign Income
A majority of the resident individuals who participate in stock investment do so through shares of foreign companies. As a result, it could have been receiving dividends from these foreign shares.
As per Section 139(1) of the Income-tax Act, an individual must file the ITR, if he possesses some assets like foreign shares, bonds any foreign company, house property irrespective of its location in a foreign country, Dividend, interest income, rents etc received from foreign nations. Even a person having signing authority in any account in India as well as in any foreign account needs to file his/ her ITR.
2. Spending Rs. 2 lakh + on Foreign Travel
It is required to file an ITR if a resident individual has incurred expenses of more than Rs. 2 lakh on himself or herself or any other person for travel to another country.
3. Paying Rs. 1 lakh + Electricity Bill in a Financial Year
In the case of non-eligible criteria for filing ITR, however, if a taxpayer has paid an electricity bill of more than Rs 1 lakh in a financial year then an ITR return is mandatory.
4. Deducting or collecting TDS/TCS of Rs. 25,000
ITR Filing is mandatory if the aggregate of tax deducted at source (TDS) and/ or tax collected at source (TCS) during the previous year, in the case of the person, is twenty-five thousand rupees or more.
Provided that in the case of an individual resident in India who is of the age of sixty years or more, at any time during the relevant previous year, the provision of clause (iii) shall have effect as if for the words “twenty-five thousand”, the words “fifty thousand” had been substituted.
5. Deposited Rs.1 crore in Current Account
A taxpayer who has deposited an amount or aggregate of the amounts exceeding one crore rupees in one or more current accounts maintained with a banking company or a cooperative bank is mandatory to file his ITR.
6. If you have to claim Income Tax Refund
ITR Filing is compulsory if you want to claim a refund of the TDS deducted and your Income is less than the Slab Limit.
