Why And When It Is Important To File ITR If Your Income Is Not Taxable?

It is widely known that any Indian person whose net total income in a financial year reaches the taxable limit is necessary to file a tax return on their income. Often, though, some people question if a taxpayer is not required to file his or her income return if the income does not reach the taxable limit? And, if so, under what conditions then?

As per the tax provisions, tax experts claim that filing income tax returns is necessary if an individual’s gross taxable income is more than Rs 2,50,000. The reason that the relation is rendered to the aggregate net income here, which would imply the earnings before any exemptions under Chapter VI-A, must be noted. Thus, even though he does eventually not have any tax payable or may even have a refund, a person with his gross total income above Rs 250,000 must file a tax return. An individual who does not have taxable income is still required by statute to file a tax return if he satisfies any of the requirements set out below:

• In one or more current bank accounts with any bank, the person has deposited an aggregate sum exceeding Rs 1 crore.
• Expenses of an aggregate sum exceeding Rs 2 lakh have been incurred by the individual for himself or any other person to fly to a foreign nation.
• The person has levied expenditure for the usage of energy in the amount or aggregate of sums exceeding Rs 1 lakh.
• In addition, any individual classified as ‘resident and ordinarily resident’ in India in the course of a financial year shall be required to file a tax return even if the gross total income is below the standard exemption limit if he owns any assets, bank accounts, authorizing authority in any account or interest of the beneficiary in any institution outside of India. In his tax return, such a person is required to report this.
• Individually, in order to generate their claims and seek compensation, persons seeking relief under the DTAA rules, claiming reimbursement of excess taxes, carrying forward losses must file tax returns. Even if not necessary to ensure continuity of his tax reports, a person may still want to file a tax return that will help with the appropriate documents for getting a loan, visa, and so on.