Why Should We File Income Tax Returns?

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Mandatory Filing of Returns

  • Where the gross total income before allowing any deductions under Section 80C to 80U exceeds Rs. 2.5lakhs in the previous Financial Year. This limit is Rs. 3lakhs for senior citizens and Rs. 5lakhs for super senior citizens.
  • You are a firm or company.
  • You have exempt long-term capital gains from sale of equity shares of company or sale of business trust or sale of equity oriented mutual funds of over Rs. 2.5lakhs in financial year.
  • You are required to file return when you receive income from property held under charitable or religious purposes or research association or medical institution.
  • Foreign companies taking treaty benefit on transactions in India.
  • In cases where person needs to claim adjustment against past losses, return is mandatory.
  • While applying loans, the eligibility for loan depends on one’s income which is established through ITRs. These returns are accepted easily for loan and visa processing.
  • Filing IT returns make you a responsible person
  • Credit card companies need proof of income tax returns before issuance of cards


When to File Income Tax?
Income tax returns have to be filed within a pre-determined due date to avoid any penalty. For Financial Year 2018-2019, Assessment Year 2019-2020, tax returns must be filed before 31st July 2019 for individuals, and by 30 September 2019 for businesses.

Penalty for Non-Filing Income Tax Return
For non-filing of income tax returns, penalty of Rs. 5000 is applicable for FY 2017-18 in cases where it is filed after due date of 31 August 2018 but by 31 December 2018. Where return is filed after 31 December 2018 but by 31 March 2019, penalty of Rs. 10000 is applicable. Those with income up to Rs. 5lakhs, penalty is limited to Rs. 1000.

Are you a novice when it comes to income tax return filing? No worries! Don’t hesitate to ask your queries in the comments section below.

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