ITR: Filing Returns Is Mandatory Under These Scenarios

The tax season is approaching. So, it’s important to understand that filing your Income Tax Return (ITR) is not just advisable, but mandatory. While many taxpayers associate ITR filing with higher income levels, there are circumstances where submitting a return is mandatory, regardless of your earnings. Whether it’s to claim a refund, comply with statutory obligations or maintain financial transparency, knowing the rules for Assessment Year 2025-26 (fiscal year 2024-25) can help you avoid penalties and missed opportunities. Let’s find out the conditions under which filing your ITR becomes compulsory.

Even if your income falls below the tax-free exemption limit, the Income Tax Department mandates filing a return under these circumstances:

• If your business's total sales, turnover, or gross receipts exceed Rs 60 lakh during the previous year.

• If your profession's total gross receipts exceed Rs 10 lakh during the previous year.

• If the combined tax deducted at source (TDS) and tax collected at source (TCS) during the previous year is Rs 25,000 or more. For senior citizens above 60 years, this threshold is Rs 50,000.

• If you have deposited more than Rs 50 lakh in one or more savings bank accounts during the previous year.

• If you have deposited Rs 1 crore or more in one or more current accounts with a bank.

• If you have spent more than Rs 2 lakh on foreign travel, whether for yourself or others.

• If your annual electricity expenditure exceeds Rs 1 lakh.

Whether you’re salaried or self-employed, it's important to understand when ITR filing is mandatory. Meeting any of the above conditions makes filing an ITR compulsory, even if your taxable income is nil.

Missing a required filing can result in penalties, loss of benefits and complications in financial matters. Always stay informed and act within the timelines to ensure compliance and financial health.