Do I need to submit an income tax return if I don’t owe any money to the government?
ITR filing deadline: July 31, 2023, is the deadline for filing an income tax return (ITR) for fiscal year 2022-23 or assessment year 2023-24. However, there appears to be significant uncertainty among those earning persons who do not have any tax due prior to ITR filing. These individuals feel that they have no income tax due and hence do not need to Submit an ITR. Senior folks appear to be confused as well, believing that they have earned interest income after deducting taxes at the source. However, this is wrong.
Tax and investment experts say that if TDS has been deducted from an employee’s salary and the employee’s yearly income is below the threshold limit, they must submit an ITR. Similarly, if a person’s annual income is less than the threshold limit but he or she has invested in mutual funds, equities, bank fixed deposits, and so on, the person’s net income would include income from all sources and, if it exceeds the threshold limit, the earning individual must file an income tax return.
Filing of income tax forms for salaried persons
Balwant Jain, a Mumbai-based tax expert, advised earning individuals to calculate all sources of income. “It’s possible that you won’t owe any taxes because of various deductions and rebates, but you’ll still need to file your ITR,” if the sum of all taxable income exceeds the prescribed threshold,” he said. For example, if your annual income is less than 5 Lakhs and does not include any long-term capital gains from listed stocks and equity funds. You will have no tax liability because of the refunds offered under Section 87A, but you must still submit an ITR.”
Balwant Jain went on to say that the income to be examined for this purpose is the income before the different deductions available under Chapter VIA, which primarily include Sections 80C, 80 CCD, 80D, 80G, 80TTA, 80 TTB, and so on. These deductions mostly pertain to life and health insurance premiums, payments to EPF, PPF, and NPS accounts, bank interest, tuition costs for children, house loan repayment, and so on. Certain exempt earnings, such as exemption from long-term capital gains under Sections 54, 54EC, and 54F, must be included when calculating taxable income.
“The basic exemption threshold is 2.50 lakhs for those under the age of 60.” It is 3 lakhs and 5 lakhs for those aged 60 to 80 and above 80 years old, respectively. “Even though you may not owe any taxes because of various deductions and rebates, you still need to file your ITR if the total of all taxable income exceeds the specified threshold” Balwant Jain explained.
The baseline exemption level is 2.50 lakhs for people under the age of 60. It is 3 lakhs and 5 lakhs for those aged 60 to 80 and above 80 years old, respectively.
ITR preparation for bank depositors
According to SEBI registered tax and investment expert Jitendra Solanki, “If a person has deposited 1 crore or more in one’s current account or 50 lakh or more in one’s savings account in a single fiscal year, then the bank depositor needs to file ITR even if he or she has no income tax liability.” Similarly, if the tax deducted on your income exceeds 25,000 in a single fiscal year, you must file an ITR for that fiscal year. If you are a senior person, your tax deduction is limited to $50,000.”
Jitendra Solanki, on the other hand, urged both Senior Citizens and persons under the age of 60 to submit ITR if TDS is deducted on their bank interest income or any other kind of income.
