Who Should File Income Tax Return (A.Y. 2023-24)

who is required to file income tax return

Who should file income tax return (A.Y.2023-24): According to the Income Tax Laws, if a resident individual has earned a total income exceeding the basic exemption limit during the financial year, he or she must file an ITR on a mandatory basis. If you opt for the old income tax regime, the basic exemption amount for an individual will be determined by their age. The basic exemption limit remains the same regardless of age if an individual taxpayer opts for the new tax regime. This article answers a common questions: Do I need to file an income tax return? Is there a penalty if I fail to file my income tax return?

What is Assessment Year?

Let’s assume the year is 2023. During the financial year (F.Y.) 2022-23, which begins April 1, 2022, and ends March 31, 2023, the assessment year would be 2023-24.

As a result, if you need to file your income tax return (ITR) for the financial year 2022-23, you should do so for the assessment year 2023-24.

For the assessment year 2023-24, You should file income tax return by 31st July 2023. In the period from 1st April 2022 to 31st March 2023, our income will be subject to taxes.

Who Should File Income Tax Return?

Income tax returns are required if you have a gross total income that exceeds the basic exemption threshold. Here are the basic exemption limits for individuals under the new and old tax regimes for the financial year 2022-23:

Income Tax Regime Basic Exemption Limit
Old Tax Regime ₹2,50,000
New Tax Regime
  • ₹2,50,000 for individuals below 60 years of age,
  • ₹3,00,000 for senior citizens (60-80 years),
  • ₹5,00,000 for super senior citizens (above 80 years)

Even if your total income does not exceed the basic exemption limit, you should file your income tax return in some cases. The following are some examples. 

  • A person who has spent more than 2 lakh on an international trip.
  • It will be mandatory for individuals who spend more than Rs. 1 lakh on electricity bills or deposit more than Rs. 1 crore in current accounts to file ITRs.
  • Individuals with income from foreign countries or assets in foreign countries. Since international income is taxable in India, a resident must include it in their total income.
  • A person who has deposited more than Rs. 1 crore with a bank or co-operative bank in the past year.
  • If the income of the individual (before any deductions are made under section 10 (38) or 10A or 10B or 10 BA or 54 or 54DB or 54D or 54EC or 54F or 54G or 54GB or under chapter VIA exceeds the basic exemption limit, then the individual must file an income tax return.
  • In addition to filing a return of income, if you have more than 25,000 TDS/TCS in general or 50,000 for seniors, you must file a return of income.
  • Those who purchase or sell real estate for more than Rs. 30 lakh as well as any investments in stocks, mutual funds, debt instruments, bonds, or payments on credit card debts over Rs. 10 lakh.
  • A bank account’s cash deposits and withdrawals exceeding Rs. 10 lakh in a fiscal year, or Rs. 50 lakh in a current account, must be specified on the IT return.

Who is Exempt to File ITR  A.Y. 2023-24?

Senior citizens who are 75 years of age or older do not need to file income tax returns if they meet the following criteria.

  • The only source of income is pensions and pension interest
  • Those who make a bank declaration in form 12BBA to that effect
  • Under section 194P, the bank has deducted TDS from their income

Penalty for Late Filing of Income Tax Return A.Y.2023-24

You can still file your income tax return (ITR) if you missed the deadline. However, you will be charged a late filing penalty and interest. Individuals with a total income greater than Rs. 5 lakh are subject to a late filing penalty of Rs. 5,000. Individuals with incomes under Rs. 5 lakh are subject to a late filing penalty of Rs. 1,000.

Tax interest is calculated at 1% per month for late payments. For the period between the due date and the date of filing your ITR, you will owe interest on the taxes that you owe.

In order to avoid penalties and interest, you must file your ITR by the deadline. In the event you are unable to file your ITR by the deadline, you should contact the Income Tax Department as soon as possible to discuss your options.

Individuals Resident (Non-Audit Cases)

Total Income Fee (Penalty)
Up to Rs.5 Lakh Rs.1000/-
More than Rs. 5 Lakh Rs.5000/-

FAQ

Who is required to file an income tax return?

A. According to the Income Tax Laws, if a resident individual has earned a total income exceeding the basic exemption limit during the financial year, they must file an Income Tax Return (ITR) on a mandatory basis.

What is the basic exemption limit for filing an income tax return?

The basic exemption limit for filing an income tax return depends on the individual’s age and the tax regime they choose. Under the old tax regime, the basic exemption limit is ₹2,50,000 for all individuals. However, under the new tax regime, it varies as follows:

₹2,50,000 for individuals below 60 years of age
₹3,00,000 for senior citizens (60-80 years)
₹5,00,000 for super senior citizens (above 80 years)

Are there any exceptions where filing an income tax return is necessary even if the income is below the basic exemption limit?

Yes, there are exceptions where filing an income tax return is still required, even if the total income does not exceed the basic exemption limit. These exceptions include:
Spending more than ₹2 lakh on an international trip
Spending more than ₹1 lakh on electricity bills or depositing more than ₹1 crore in current accounts
Having income from foreign countries or assets in foreign countries
Depositing more than ₹1 crore with a bank or cooperative bank in the past year
When specific deductions under various sections result in the income exceeding the basic exemption limit
If the total TDS/TCS deducted is more than ₹25,000 (general) or ₹50,000 (seniors)
Buying or selling real estate for more than ₹30 lakh or making certain investments or payments exceeding specified thresholds

Q. What is the Assessment Year?

The assessment year is the year following the financial year for which the income tax return is filed. For example, if you need to file your income tax return for the financial year 2022-23, the assessment year would be 2023-24.

Q. What happens if I miss the deadline for filing my income tax return?

f you miss the deadline for filing your income tax return, you can still file it later. However, there will be penalties and interest imposed. For individuals with a total income above ₹5 lakh, the late filing penalty is ₹5,000. For individuals with incomes below ₹5 lakh, the penalty is ₹1,000.

Q. Are there any exceptions to filing an income tax return for senior citizens?

Yes, senior citizens who are 75 years of age or older may be exempt from filing income tax returns if their only source of income is pensions and pension interest, they make a bank declaration in form 12BBA to that effect, and the bank has deducted TDS from their income under section 194P.

MCQ To Test Your Knowledge

1. What is the purpose of filing an Income Tax Return (ITR) according to the Income Tax Laws?
a) To receive a tax refund
b) To calculate the total income earned
c) To claim deductions and exemptions
d) All of the above

2. What determines the basic exemption limit for filing an income tax return?
a) The individual’s age
b) The individual’s occupation
c) The individual’s gender
d) The individual’s residential status

3. Which tax regime has a different basic exemption limit based on age?
a) New tax regime
b) Old tax regime
c) Both tax regimes
d) None of the above

4. Under the new tax regime, what is the basic exemption limit for individuals below 60 years of age?
a) ₹2,50,000
b) ₹3,00,000
c) ₹5,00,000
d) ₹10,00,000

5. In which of the following cases is it mandatory to file an income tax return, even if the total income is below the basic exemption limit?
a) Spending more than ₹1 lakh on electricity bills
b) Depositing more than ₹1 crore in a current account
c) Having income from foreign countries
d) All of the above

6. What is the assessment year for the financial year 2022-23?
a) 2020-21
b) 2021-22
c) 2022-23
d) 2023-24

7. What is the penalty for late filing of an income tax return for individuals with a total income above ₹5 lakh?
a) ₹500
b) ₹1,000
c) ₹5,000
d) ₹10,000

8. Which individuals may be exempt from filing income tax returns if their only source of income is pensions and pension interest?
a) Individuals below 60 years of age
b) Senior citizens (60-80 years)
c) Super senior citizens (above 80 years)
d) Individuals 75 years of age or older

9. What is the penalty for late filing of an income tax return for individuals with a total income below ₹5 lakh?
a) ₹100
b) ₹500
c) ₹1,000
d) ₹5,000

1. Answer: d) All of the above
2. Answer: a) The individual’s age
3. Answer: b) Old Tax Regime
4. Answer: a) ₹2,50,000
5. Answer: d) All of the above
6. Answer: d) 2023-24
7. Answer: c) ₹5,000
8. Answer: d) Individuals 75 years of age or older
9. Answer: c) ₹1,000

5 thoughts on “Who Should File Income Tax Return (A.Y. 2023-24)”

  1. My Mrs is a salaried person under Govt Odisha۔For the financial yr 2018-19 and assesment yr 2017-18 tax payable was nil after through calculation and the same was deposited in form in FEB-MARCH 2018.Now her employer gave her form 16A and instructed to file ITR.Is it mandatory to file ITR.Please guide in this regard.

    Reply
  2. Hi,
    It is a tedious task for almost all these days ! We have a problem and it has to resolved. My relative suggested Tax2win to me and I must tell you that it is the most easiest way to file your income tax return online.

    Reply
  3. how to calculate long term capital gain for eq.share purches before 5 years. how to calculate indexion for p.price of share to calculate long term profit(capital gain) for eq.share purches before 5 years.pl.give example to understand.

    Reply
  4. I am a sr. citizen of age 69 years (D.O.B. – 01/06/1945), drawing a gross salary of Rs. 564000/- per annum during 2014-15. I draw the same salary in 2013-14. TDS was deducted last year. But I could not file my RTI. Now What should I do?
    Also tell me what amount of Tax I will have to deposit.
    Ansari

    Reply
  5. Dear Sir,

    My mother inherited a share of residential property from her
    mother i.e. my grand-mother in year 1991 for Rs. 60,000 (60 thousand) as
    her share, which she sold off year June’2013 for Rs. sixteen-lakhs
    as her share. Amount received is completely reinvested in our first
    residential house as joint property with me i.e. her son.

    Other than this, she don’t have any other income.

    I am confused, is she Liable to file any ITR for AY 2014-2015 for any such LTCG.

    It will be kind of you, if you can let me know that Is it absolutely necessary to
    file NIL ITR for this LTCG.

    Thanks
    Avishkar

    Reply

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