Is Income Tax return filing necessary?
As per the income tax laws, filing of ITR is mandatory if an individual has done certain specified transactions or has a gross total income above the basic exemption limit for FY 2022-23 (AY 2023-24). If an individual’s taxable income exceeds the basic exemption limit, then ITR filing becomes mandatory.
We understand you may find filing for IT returns burdensome, especially if you are young and have barely filed a couple of IT returns. But its benefits are far more than the labor involved in filing it. Also, it is the duty of all the responsible citizens of the country. The income tax laws state that filing IT returns is mandatory for some but voluntary for others.
Irrespective of the category you fall into, it is imperative for you to file it. With the tax department allowing online income tax return filing, the process takes minutes to complete in most cases.
- Legal Requirement:
In India, as per the Income Tax Act, 1961, it is mandatory for individuals, Hindu Undivided Families (HUFs), companies, and other entities to file income tax returns if their total income exceeds the threshold specified by the government in a particular financial year. - Credit and Visa Applications:
Some financial institutions may require you to submit income tax returns as proof of income when applying for loans or credit cards. Additionally, when applying for visas to certain countries, providing income tax returns can demonstrate your financial stability.
- Documentation:
Income tax returns serve as essential documentation of your financial transactions and income for a specific financial year. They provide a record of your financial history, which can be useful for various purposes, including obtaining loans or visas. - Compliance:
Filing income tax returns ensures that you are in compliance with the tax laws of your country. Non-compliance, such as not filing returns when required, can lead to penalties and legal consequences.
Is it compulsory to file ITR if income is below 2.5 lakhs?
The short answer is No, you do need to file ITR for income less than 2.5LPA (lakhs per annum). Indeed, the bright side of being in this income tax bracket is that you do not need to compulsorily file ITR or pay any taxes at least.
How much salary is required for ITR filing?
Who Should Pay Income Tax? It is mandatory to file ITR for individuals If the total Gross Income is over Rs.3,00,000 in a financial year (Including standard deduction). This limit exceeds Rs.3,00,000 for senior citizens and Rs.5,00,000 for super senior citizens.
It’s important to understand the income tax laws and regulations in your country and comply with them. The specific rules regarding income tax return filing, thresholds, and deadlines may vary from one jurisdiction to another, so it’s advisable to consult with a tax professional or refer to the tax authority’s guidelines to ensure compliance.