Compulsory filing of Income tax return (ITR)
It was very much cleat until FY 2018-19 that, filing of income tax return is compulsory for only those whose total income exceeds above exemption threshold limit i.e. when the total annual income exceeds the maximum amount, which is not chargeable to income tax. Anybody who is less than 60 years of age and has an annual income of more than Rs. 2.5 lakhs has to file income tax returns. For senior citizens, the limit is Rs. 3 lakhs, and for those who are more than 80 years old, limit is Rs. 5 lakh.
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However, what is stated above is not the only criteria for compulsory filing of Income tax return ! Yes income threshold is no more the only criteria for compulsory filing of income tax return!
Finance act 2019 inserted new proviso w.e.f. 1-4-2020 widening scope of compulsory filing of the Income tax return, even though the person is otherwise not required to file a return of income due to total income is below the basic exemption limit.
As per amended sixth proviso to section 139(1), every person, if his total income during the previous year, without giving effect to the provisions of section 54 or section 54B or section 54D or section 54EC or section 54F or section 54G or section 54GA or section 54GB exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income
As per the seventh proviso to section 139(1) of the Income Tax Act, 1961 a person will have to file ITR if he/she meets any of the criteria mentioned :
A person who :
(i) 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 co-operative bank; or
(ii) has incurred expenditure of an amount or aggregate of the amounts exceeding two lakh rupees for himself or any other person for travel to a foreign country; or
(iii) has incurred expenditure of an amount or aggregate of the amounts exceeding one lakh rupees towards consumption of electricity; or
(iv) fulfils such other conditions as may be prescribed.
It is advisable to all just don’t assume that filing of income tax return is not applicable to you and check whether you are fulfilling any of the criteria to avoid future litigations!
