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Am I required to file IT Returns?

Author: Balwant Jain/Wednesday, July 18, 2018/Categories: Tax, Expert View

Am I required to file IT Returns?

Many salaried people are under the impression that they are not required to file Income Tax Returns (ITR) because tax has already been deducted from their salary. Some retired people also feel the same as banks deduct tax on their fixed deposit interest. These people treat deduction of tax at source as equivalent to filing of ITR, which is not correct. Filing of ITR and discharging appropriate tax liability, are two different responsibilities and have to be discharged separately.

One is required to file ITR if sum of all his/her taxable income before deduction under various sections of chapter VIA like 80C, 80CCC, 80CCD, 80D, 80E, 80G, 80GGA, 80TTA etc. exceeds the basic exemption limit. These sections cover deductions like ELSS, NSC, PPF, repayment of principal of home loan, tuition fee for two children, life insurance premiums, NPS, mediclaim premiums, donations, interest on education loan, rent paid by self employed and deductions from saving bank account interest.

The basic exemption limit for the year ended March 31, 2018 was Rs 2.5 lakhs for individuals below 60 years, Rs 3 lakhs resident individuals over 60 years but below 80 years and Rs 5 lakhs for resident individuals above 80 years.

While arriving at the basic exemption limit, you have to add the exemption under Section 10(38), available for long term capital gains on listed equity shares and units of equity oriented schemes.

You also need to file ITR if you have interest in any asset, whether immovable or movable, outside India either as beneficial owner or as legal owner or if you are a signatory of any bank outside India. It may apply to people who opened a bank account outside India and came back without closing.

Residents who have any income outside India also have to mandatorily file the ITR. Similarly, residents who have invested in shares, bonds or mutual fund units of foreign companies also need to do it. You have to file ITR in case any EOPS of a foreign company have been allotted to you, which may be a holding company or a subsidiary company of your employer.

By now, for sure you realise that majority of you are required to file your ITR.

The author is a CA, CS and CFPCM

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Balwant Jain
Balwant Jain

Balwant Jain

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1 comments on article "Am I required to file IT Returns?"

SHYAM PANDURANGI

7/18/2018 6:15 PM

Very good infn., thank you

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