Many taxpayers believe that filing an income tax return (ITR) is not necessary if their annual income is below the basic exemption limit of Rs 2.5 lakh under the old tax regime and Rs 4 lakh under the new
tax regime. While this is generally true, the income tax department has prescribed certain situations where filing an ITR becomes mandatory regardless of income level.
Here are some cases where individuals must file an ITR even if their taxable income is below the threshold level:
Deposits Above Prescribed Limits
ITR filing is compulsory if an individual deposits more than Rs 1 crore in one or more current accounts with a bank or cooperative bank during a financial year.
Similarly, a person must file an ITR if deposits exceeding Rs 50 lakh are made in one or more savings bank accounts during the financial year.
High Foreign Travel Spending
An individual is required to file an ITR if the expenditure on foreign travel for themselves or any other person exceeds Rs 2 lakh during the financial year.
Large Electricity Bills
ITR filing is mandatory if a person’s electricity bill payments exceed Rs 1 lakh during the financial year.
Foreign Assets or Signing Authority
A resident individual who owns any asset located outside India or is a beneficiary of a foreign asset must file an ITR. The same rule applies to individuals who have signing authority in any account located outside India.
Business Turnover and Professional Receipts
Individuals engaged in business must file an ITR if their total sales, turnover or gross receipts exceed Rs 60 lakh during the financial year.
For professionals, ITR filing becomes mandatory if gross receipts from the profession exceed Rs 10 lakh in a financial year.
Higher TDS or TCS Deduction
An ITR must be filed if the aggregate tax deducted at source (TDS) and tax collected at source (TCS) is Rs 25,000 or more during the financial year. For senior citizens, this threshold is Rs 50,000.
Large Savings Bank Deposits
If the total amount deposited in one or more savings bank accounts is Rs 50 lakh or more during the financial year, filing an ITR is mandatory.
Why Filing an ITR Is Important
Even when not legally required, filing an ITR can be beneficial. It serves as proof of income, helps in claiming tax refunds, supports loan and visa applications, and creates a financial record that may be useful in the future.
Taxpayers should therefore check whether any of the above conditions apply to them before deciding not to file their income tax return.
When Will ITR Filing Start This Year?
ITR filing has already started for the current assessment year 2026-27 (financial year 2025-26). However, tax experts recommend that taxpayers wait till June 15 before filing the income tax return, as Form 16 as well as updated AS26 and AIS will be available by then.
Employers are required to issue Form 16 to employees after filing their quarterly TDS returns for the January-March quarter. As per the income tax rules, the last date for employers to issue Form 16 for FY 2025-26 is June 15, 2026.
The deadline for individual taxpayers is July 31.
