Income tax return (ITR) filing is mandatory for those whose taxable income is more than the exempted threshold limit. However, there are situations when an individual would need to file ITR even if the total income is below the exempted limit.
Here are some of those situations:
- According to Naveen Wadhwa, chief executive officer, Taxmann, an individual should file ITR when the income before capital gain exemption (Section 54 to 54GB) or deductions (Section 80C to 80U) exceeds the maximum amount not chargeable to tax.
- Also, it should be filed when the citizen owns overseas assets or has signing authority in any account outside India.
- Filling of return even becomes necessary if an individual has deposited an amount or aggregate amount of Rs 1 crore or more in one or more current accounts during the financial year.
- Filling of return is also necessary if an individual spent an amount or aggregate amount more than Rs 2 lakh on foreign travel for self or any other person during the financial year.
- According to Kapil Rana, founder and chairman, HostBook Ltd, filling of return is necessary if, an individual spent an amount or aggregate amount more than Rs 1 lakh on consumption of electricity during the financial year.
- Those having non-taxable income can also file ITR for various other purposes like visa, bank loan, credit card application.
- Filing ITR also helps an individual if he/she is planning to immigrate to another country or seeking a job opportunity abroad. They should have their ITRs ready for the past 2-3 years because most of the embassies ask for these copies to process their visa application.