NIL ITR: What are the benefits of filing ‘Zero Return’? know in details

Jyoti — Tue, 27 Aug 2024 07:13:22 +0000

NIL ITR: People whose income does not fall under the tax bracket do not file ITR. But even if you have zero tax liability, you should file zero return. In this, you do not have to pay even a single rupee tax, so it is called zero return. This means that you have to tell the Income Tax Department that your income is below the taxable income, so you did not pay tax.

NIL ITR: The last date for filing Income Tax Return (ITR) is 31st July. Now you will have to pay a penalty for not filing income tax. But, zero return i.e. return with zero tax liability can still be filed without any penalty. The thing to keep in mind in this is that you will not be able to claim any deduction. Your total income should fall directly within the basic exemption limit.

In the new tax regime, the basic exemption limit is Rs 3 lakh for everyone. Whereas, in the old tax regime, the basic exemption limit for people below 60 years of age is Rs 2.5 lakh. For 60-80 years, it is Rs 3 lakh and for people above 80 years of age, it is Rs 5 lakh. People falling in this category can file returns without penalty.

Let us know why one can file zero return, why it is filed, what are its benefits.

Easily get loan

Income tax return serves as proof of your income. When you file ITR, it becomes a solid proof that you are earning from some source. This also creates your credit profile. This makes it easier for you to get a loan from a bank or NBFC (Non-Banking Finance Companies).

TDS will be refunded

If you are a salaried person and are unable to submit Form 15G/H, then TDS (Tax Deduction at Source) will be deducted from your salary. In such a situation, zero return can save you from loss. With its help, you can claim the refund of the TDS amount which your company has deducted from your salary.

The advantage of showing a loss

If you invest in business or stock market, you may incur loss during the financial year. In such a situation, you can show your loss by filing zero return. When you make profit in the future, you can adjust that loss in taxable income. This will reduce your tax liability.

You will get visa easily

With zero ITR, you can easily get visa for many countries. Sometimes visa officers ask for ITR of a few years for foreign travel. They actually want to verify your income level. In such a case, ITR may also be required along with bank statements and other financial documents.

Also Read- GST taxpayers Alert! GSTR-1 will not be filed without bank account information, the rule will be applicable from this day

Also helpful for scholarship

Many scholarships or fellowships are given on the basis of income. If you have filed zero ITR, then you can easily show your income limit. This will make it easier for you to get those government fellowships, which are especially for low-income families.

Who can file zero return?

If you are filing income tax return for the first time and your total income does not fall under the taxable income bracket, then you can file NIL return. It can also be filed by those who have been filing returns for the past several years, but this time their income has fallen below the income tax bracket. However, filing a zero return after the deadline does not provide benefits like carrying forward of losses.

Nil ITR Update: What is Nil ITR? What are its benefits? What should be filed by those earning less than 2.5 lakhs?

Pravesh Maurya — Thu, 28 Jul 2022 08:28:34 +0000

ITR Filing Last Date : The last date for filing Income Tax Return is 31st July. Whenever it comes to the tax exemption limit, many people remain skeptical about whether it is necessary for them to file ITR or not. Many people believe that their salary is less than 5 lakhs and it has been said by the government that zero tax is levied on those earning less than 5 lakhs, so whether to file income tax return or not. At the same time, some believe that their salary is less than 2.5 lakhs, so they do not need to fill ITR. If you are also in this state of confusion, then we are going to tell you who should file ITR and who should not and what are its benefits.

It is necessary to file IT Return

If your gross total income is more than Rs 2.5 lakh, then it is necessary for you to file Income Tax Return. This limit is 3 lakhs for senior citizens and 5 lakhs for people above 80 years. If your total income is less than Rs 2.5 lakh, then you do not need to file ITR. But if you file income tax return despite low salary, then it has many benefits.

Benefits of filing Nil IT Return

According to tax and investment expert Jitendra Solanki, even if your salary is less than 2.5 lakhs, you can still file income tax return. This is called Nil, ie Zero IT Return. The advantage of this is that if you want to apply for a loan, whether it is a home loan or a car loan or a personal loan, the IT return is sought from the bank or the lending institution and if you submit the IT return. If you do, then it becomes very easy to get your loan approved.

What to do if taxable income is Rs 5 lakh?

On earning up to Rs 2.5 lakh, you get rebate ie exemption from income tax. If your total taxable income is less than Rs 5 lakh, then you get exemption on the remaining Rs 2.5 lakh. In this case your tax liability is zero. If your total income is much more than 2.5 lakhs, then it is necessary to file ITR. Not only will you not get the exemption for not filling the ITR, on the contrary, you will also have to pay a penalty.

Why ITR Filing is Necessary?

The due date for filing Income Tax Return (ITR) for assessment year 2022-23 or financial year 2021-22 is 31 July 2022. In such a situation, people coming in the income group are advised to file their ITR before the deadline. If your total income is more than Rs 2.5 lakh, then you are required to file ITR. This limit is 3 lakhs for senior citizens and 5 lakhs for people above 80 years.

The post Nil ITR Update: What is Nil ITR? What are its benefits? What should be filed by those earning less than 2.5 lakhs? first appeared on Rightsofemployees.com.

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