ITR Filing: Who Are Mandatory & Who Are Exempted To File ITR for AY 2022-23? (2024)

Who is required to file ITR?

If a person's gross annual income exceeds ₹2,50,000 under the new tax regime in a fiscal year, submitting a tax return is required, per tax regulations. Gross annual income comprises earnings from a variety of sources, including salaries, real estate, capital gains, etc. The exemption ceiling under the old regime was Rs. 2.5 lakh for individuals under the age of 60, Rs. 3 lakh for senior citizens over the age of 60 but below 80, and Rs. 5 lakh for those above the age of 80. (super senior citizens).

The income tax regime selected by the taxpayer when submitting an ITR determines the basic exemption threshold for each individual. An individual or HUF must file a tax return if their total income, before any deductions or exemptions, surpasses the statutory exemption threshold. Individuals must, however, report any international trip expenses above ₹2 lakh in their income tax return (ITR). If a bank account's cash deposits and withdrawals exceed ₹10 lakh in a fiscal year, and Rs. 50 lakh in a current account, then it is mandatory to specify in IT return. The government has announced new income-tax return forms for 2019–20.

Those who spend more than ₹1 lakh in electricity bills or deposit more than ₹1 crore in current accounts would need to file ITRs on a mandatory basis. If you are a resident, any income you receive from a foreign country must be specified in your total income, since it is taxable in India. The Indian Income Tax Act, 1961, known as NRI taxes, relates to those who generate income outside of their place of residence. Before seeking a tax deduction on capital gains under sections 54, 54B, 54D, 54EC, 54F, 54G, 54GA, or 54GB, an individual's gross total income must not exceed the basic exemption limit or else tax filing is mandatory.

You are still required to file a return of income if your total TDS/TCS is ₹25,000 as a general public and ₹50,000 as a senior citizen, ITR filing is required if you have a salary of Rs. 10 lakh or more per year or if your income from a business or profession exceeds Rs. 50 lakh. Any purchase or sale of real estate for ₹30 lakh or more must be disclosed on Form 26AS, as well as any investments in stocks, mutual funds, debt instruments, bonds, or payments on credit card debts that surpass ₹10 lakh should be specified in ITR.

Who is exempted from filing ITR?

If they fulfill certain requirements outlined in the Income Tax Act of 1961, super elderly persons 75 years of age and above will no longer be needed to file ITRs as of FY 2021–22. Through the Finance Act of 2021, the government added a new Section 194P to the Income Tax Act of 1961, defining the standards for an exemption for older persons from filing income tax returns. If you are a resident of India and were 75 or older the year before, that is, in FY 2021–2022, you are exempted from filing an ITR. You must also have interest income earned from the same specified bank where you get your pension, and you must provide the defined bank with a declaration, which returns in your exemption of filing ITR.

What if you fail to submit ITR on or before 31st July 2022?

To minimize the last-minute rush, it is advised to file the returns as early as possible before the deadline ends. If you fail to submit your ITR by the deadline, you will need to file a belated ITR and pay a penalty. Returns may still be submitted up to December 31 of the assessment year 2023 even if the ITR filing date is July 31. Therefore, the deadline for submitting a late return is on or before the end of the applicable assessment year. A belated return for 2021–22 may be filed up until December 31, 2022, or three months before the AY2023 ends on March 31, 2023, as per the guidelines set by the Income Tax Department. You must, however, pay a penalty on the belated filing of ITR. If you submit your ITR after the deadline of July 31, 2022, but before December 31, 2022, you will be subject to a penalty of up to ₹5,000. Nevertheless, the penalty for belated ITR will only be ₹1000 for taxpayers whose total income is less than ₹5 lakh. Additionally, a taxpayer may get a notice of investigation from the tax department if a taxpayer fails to submit the belated return for the fiscal year 2021–22 (AY 2022–23).