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Why you should file ITR even if your Income is not Taxable

Updated on: 21 Jun, 2024 02:34 PM

Is it necessary to file an ITR even if my income is below the taxable limit? This question often crosses the minds of many individuals. While it is not mandatory to file a tax return if your income is not taxable, filing an ITR has several benefits that one should consider.

Applying for a vehicle/home loan or other financial instruments

Tax returns of previous years are a mandatory requirement whenever you apply for a vehicle/home loan, as they act as proof of your source of income. Tax returns also can be a requirement when applying for certain credit cards/insurance policies and more.


Claiming refunds

Tax deduction at source is common now for many services, especially if you are a freelancer, work on a contract, get interest income from a bank, etc. But many times, you may not fall under the taxable bracket. The only way you can claim a refund is by filing a tax return.


Applying for a visa

If you are planning to go abroad, or even if you’re not, uncertainty is a part of life. You might need to travel abroad for a reason or another, and at that time, you may need to provide previous returns to get a visa. So, even if your income is below the taxable limit, you should consider filing an Income Tax Return because who knows what might happen next.


Meets the requirement as proof of income

Salaried individuals receive salary slips that serve as income proof for various applications. However, freelancers and self-employed individuals often don’t have such specific documents. Filing income tax returns provides them with a recognized proof of income, which can be used for multiple purposes.


Claiming losses

Many individuals are investing in different kinds of assets, like stocks, bitcoins, real estate, etc. There are situations when you have to sell an asset at a loss. Did you know that certain types of losses can be carried forward for 8 years? This is possible only when the tax return is filed.

Are you also looking to avail of these benefits but struggling to file tax returns on your own? Tax2win solves all these problems by filing your tax return accurately without any hassle and helps you to get the maximum tax refund possible. Hire our eCAs to file your ITR today!


Frequently Asked Questions

Q- My income is 3 lakhs should I file ITR?

You don't necessarily have to file an ITR if your income is Rs. 3 lakhs and you fall under the new tax regime. However, there are situations where filing might be beneficial. If you're above 60 years old, even under the old regime the limit is Rs. 3 lakhs, so filing would be mandatory. Additionally, if you claimed deductions for investments or house rent allowance (HRA), filing allows you to carry forward any unused benefits to reduce your tax burden in future years. Even beyond tax purposes, an ITR serves as income proof for loans, visas, and other financial needs. If you're unsure about your situation or have claimed deductions, ca consultants can help you make an informed decision.


Q- Who needs to file income tax return in India?

Filing an income tax return (ITR) in India depends on your age, income level, and chosen tax regime. Generally, individuals below 60 years old with income below Rs. 2.5 lakhs under the old regime or Rs. 3 lakhs under the new regime don't need to file. However, the limit increases to Rs. 3 lakhs (old regime) and Rs. 5 lakhs (new regime) for senior citizens between 60 and 80 years old. It's important to note that these are just basic thresholds.


CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.