Income Tax Return: Who Needs To File ITR In India?

Income tax is a direct levy imposed on earnings from salaries, businesses and other sources. Every financial year, individuals and businesses must calculate their taxable income and pay the required tax. To report this, they need to file an Income Tax Return (ITR) if their income exceeds the basic exemption limit or meets specific conditions.

Filing an ITR is an important responsibility for taxpayers in India. The Income Tax Act requires certain individuals and businesses to file returns based on their income and financial activities. It also helps with tax refunds, maintaining financial records, and getting loans or visas.

The government has increased the Section 87A rebate limit from Rs 7 lakh to Rs 12 lakh, effectively making annual incomes up to Rs 12.75 lakh tax-free for salaried individuals. The revision includes a Rs 75,000 standard deduction.

Under the updated new tax regime, the revised slab structure is as follows:

• Rs 0 – Rs 4 lakh - No Tax

• Rs 4 lakh – Rs 8 lakh - 5%

• Rs 8 lakh – Rs 12 lakh - 10%

• Rs 12 lakh – Rs 16 lakh - 15%

• Rs 16 lakh – Rs 20 lakh - 20%

• Rs 20 lakh – Rs 24 lakh - 25%

• Rs 24 lakh & above - 30%

Taxpayers will now have four years instead of the previous two to update their ITR. These changes will come into effect from April 1, impacting tax filings for the financial year 2025-26. 

Based On Income

Under The Old Tax regime:

• Individuals below 60 years: ITR filing is required if income exceeds Rs 2.5 lakh.

• Senior Citizens (60-80 years): Required if income exceeds Rs 3 lakh.

• Super Senior Citizens (80+ years): Required if income exceeds Rs 5 lakh.

Under The New Tax Regime:

• Basic exemption limit: Rs 3 lakh (for all individuals, irrespective of age).

Based On High-Value Transactions

• Electricity bill payments exceeding Rs 1 lakh in a financial year.

• Foreign travel expenses exceeding Rs 2 lakh.

• Deposits in one or more current accounts exceeding Rs 1 crore.

If You Have Foreign Assets Or Income

• Owning a foreign bank account, property, or investment.

• Receiving income from foreign sources.

If You Have Capital Gains

• Gains from the sale of stocks, mutual funds, real estate, cryptocurrency, or other assets.

If You Want To Claim A Refund

• If TDS (Tax Deducted at Source) was deducted but your total taxable income is below the threshold, you must file an ITR to claim a refund.

If  You Own A Business

• Business owners with turnover exceeding Rs 60 lakh.

• Professionals with gross receipts exceeding Rs 10 lakh.

 If You Have Multiple Income Sources

• Earning from salary + freelancing, rental income, or interest income.

 If You Have Losses To Carry Forward

• Business losses, capital losses, or speculative losses require ITR filing to carry them forward.

For Individuals Below 60 Years (New regime)

• Up to Rs 3 lakh – NIL

• Rs 3 lakh - Rs 7 lakh – 5%

• Rs 7 lakh - Rs 10 lakh – 10%

• Rs 10 lakh - Rs 12 lakh – 15%

• Rs 12 lakh - Rs 15 lakh – 20%

• Above Rs 15 lakh – 30%

Below 60 Years (Old regime)

• Up to Rs 2.5 lakh – NIL

• Rs 2.5 lakh - Rs 5 lakh – 5%

• Rs 5 lakh - Rs 10 lakh – 20%

• Above Rs 10 lakh – 30%

For Senior Citizens (60-80 Years)

• Under the new regime, the same tax slabs as above apply.

• Under the old regime:

  • Up to Rs 3 lakh – NIL

  • Rs 3 lakh - Rs 5 lakh – 5%

  • Rs 5 lakh - Rs 10 lakh – 20%

  • Above Rs 10 lakh – 30%

For Senior Citizens Above 80 Years

• Up to Rs 5 lakh – NIL

• Rs 5 lakh - Rs 10 lakh – 20%

• Above Rs 10 lakh – 30%

The last date to file ITR for FY 2024-25 is July 31.