Under the new tax regime, salaried individuals with income up to ₹12.75 lakh may have no tax liability because of the ₹75,000 standard deduction and rebate under Section 87A, but this does not automatically exempt them from filing an Income Tax Return (ITR). ITR filing is mandatory where total income exceeds ₹4 lakh under the new regime or ₹2.5 lakh under the old regime, or where specified high-value transactions or income thresholds are met, including current account transactions of ₹1 crore or more, savings account cash deposits above ₹50 lakh, foreign travel expenditure of ₹2 lakh or more, electricity bills exceeding ₹1 lakh, business turnover of ₹60 lakh or more, or professional receipts of ₹10 lakh or more. Filing ITR also provides benefits such as proof of income, easier loan and visa approvals, claiming tax refunds, carrying forward losses, improving financial credibility, avoiding notices and penalties, and meeting compliance requirements. Taxpayers should file their returns within the prescribed due dates for AY 2026-27.
1. Tax Exemption Does Not Mean Exemption from Filing ITR
Income up to Rs 12 lakh can become tax-free due to rebate under Section 87A. Salaried individuals also get a standard deduction of Rs 75,000. But zero tax does not mean you don’t have to file ITR.
As per the new tax regime, if you are a salaried person, income up to Rs 12,75,000 attracts no tax because you get a standard deduction of Rs 75,000 and a rebate of Rs 60,000.
2. ITR Filing is Mandatory in These Situations
You must file ITR if:
(I) Your total income exceeds Rs 4 lakh in the new regime or Rs 2.5 lakh in the old regime
(ii) You have deposited or withdrawn Rs 1 crore or more in a current account during the year
(iii) Your cash deposits in savings accounts exceed Rs 50 lakh in a year
(iv) You spent Rs 2 lakh or more on foreign travel
(v) Your annual electricity bill exceeds Rs 1 lakh
(vi) Your business turnover is Rs 60 lakh or more
(vii) Your professional gross receipts are Rs 10 lakh or more for doctors, lawyers, CAs, etc.
3. The Biggest Misconception Among Salaried Individuals
Many people believe that if no tax is payable, filing a return is not required. According to CA Prahlad Sahai Kumhar, ITR can be mandatory based on your income, investments, and banking transactions.
4. Key Benefits of Filing ITR: ITR Today, Benefits Tomorrow
ITR is not just a tax document — it is your financial passport. Key benefits include:
1. Proof of Income: ITR is an official document required for loans, visas, tenders, and other official needs. Your income, your credibility.
2. Loan & Credit Approvals: Banks and NBFCs check ITR before approving loans. Strong ITR helps you get bigger loans at better rates.
3. Carry Forward of Losses: Filing ITR allows you to carry forward business or capital losses to set off against future income and save tax.
4. Claim Tax Refunds: If TDS is deducted, ITR helps you claim your refund. You get back what is rightfully yours.
5. Build Financial Credibility: Shows you are a responsible taxpayer and builds trust with banks, investors, employers, and partners.
6. Mandatory for High Value Transactions: Required for buying/selling property, mutual funds, bonds. Without ITR, you may face higher TDS.
7. Visa Applications Made Easy: ITR strengthens your visa application as proof of financial stability.
8. Avoid Notices & Penalties: Non-filing can attract notices, interest, and penalties. File on time, stay compliant.
9. Track Your Financial Growth: ITR helps you analyze income, expenses, and plan taxes better for the future.
Other Benefits: Helpful in government schemes & subsidies, required for children’s education loans, useful for business tenders & contracts, creates a clean tax history for you and your family, and opens doors to opportunities and financial freedom.
5. ITR Return Filing Due Dates for AY 2026-27
To avoid penalties, file your ITR on or before the due date:
(I) Individuals/HUF – No Business/Profession: 31st July 2026 — For salaried, rental income, capital gains. Forms: ITR-1, ITR-2
(ii) Individuals/HUF – Business/Profession (Non-Audit): 31st August 2026 — For freelancers, professionals, small business. Forms: ITR-3, ITR-4
(iii) Companies: 31st October 2026 — All companies where audit is mandatory. Form: ITR-6
(Iv) Audit Cases: 31st October 2026 — For firms, LLPs, individuals requiring audit. Forms: ITR-3, ITR-5
(v) Transfer Pricing Cases: 30th November 2026 — For international/specified domestic transactions. Forms: ITR-3, ITR-5, ITR-6
(Vi) Trusts, Political Parties, Institutions: 31st October 2026 — For charitable trusts, Section 11 entities. Form: ITR-7
So don’t get confused. Kindly check your income and other criteria. So don’t forget to report to the government on time. File your ITR on or before the due date.
Author Bio
Very informative specially for family pensioners who were assuming only standard deduction from pension and interest
Excellent analysis of a widely misunderstood provision under the new tax regime. Many taxpayers assume that nil tax liability automatically eliminates the need to file an Income Tax Return. This article clearly explains the legal position and compliance requirements, making it a useful reference for taxpayers, professionals, and consultants alike. Congratulations on the publication.
Thank you for simplifying a complex topic. The discussion on mandatory ITR filing requirements will help taxpayers avoid unnecessary non-compliance.
Thank you for simplifying a complex topic. The discussion on mandatory ITR filing requirements will help taxpayers avoid unnecessary non-compliance.
A timely article considering the confusion surrounding the new tax regime. The practical examples make the concepts easy to understand.
The article successfully addresses one of the most common questions being raised after the recent tax relief announcements. Great work!
Very informative and well-structured analysis. Many taxpayers are under the misconception that no tax liability means no return filing obligation. This article effectively clarifies the position.
A valuable read for both taxpayers and tax professionals. Looking forward to more such insightful articles.
Very useful contribution to taxpayer awareness. Filing an ITR serves several purposes beyond merely paying taxes, and the article explains this very well.