Mumbai: There are many myths around filing income tax returns (ITR). Some people believe that they do not need to file their ITR if their employer issues Form 16 and deducts tax. That is not the case. In fact, depending on some conditions you may need to file ITR, even if your income is below the threshold limit.
You need to file ITR if your gross total income (excluding deductions) surpasses the basic exemption limit of income above which tax is levied. For the financial year 2019-20, this limit is Rs 2.5 lakh for persons below the age of 60 years, Rs 3 lakh for senior citizens (between 60 and 80 years) and Rs 5 lakh for super senior citizens (above 80 years of age).
If you want to claim a tax refund or want to carry forward a loss, filing ITR is mandatory regardless of your income. Further, “any resident individual who holds beneficial interest in any asset situated outside India (including financial interest in any entity outside India) or who has signing authority in a foreign bank account is also required to file ITR, irrespective of his gross total income," told Vikas Vasal, Partner and National Leader, Tax, at chartered accountancy firm Grant Thornton India LLP to Mint.
As per Budget 2019, a few more categories of people will need to compulsorily file ITR from the assessment year 2020-21. Regardless of their income level, individuals who pay electricity bill of over Rs 1 lakh in a year, spend over Rs 2 lakh on a foreign tour or withdraw Rs 1 crore in a year from a bank account in a financial year will also be required to file their ITR in 2020-21....