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Explainer: Do You Need To File ITR If Your Gross Total Income Below Basic Exemption Limit?

By on December 26, 2020 0 51 Views

There is a lot of confusion out there when it comes to ITR filing. The budget changes the slabs every year and people get confused about what slab do they come under, what are the new rules to file ITR online etc.


To clear the mist around it, here are two common scenarios that people find themselves in and the solutions:

  • I have a home bought in the name of both my husband and me. Since he is a co-borrower of the home, he receives the rent of the home in his account and the rental agreement is also done in his name. He also has invested in debt, shares, and equity mutual funds. Now, his gross total income comes under the bar of INR 2.5 lakh. Should he file an ITR?

Ans: The gross total income of a financial year is computed in accordance with the provisions of the law of the land. If the income of the individual taxpayer surpasses the basic exemption limit, then he or she must file tax returns before the due date. In the financial year 2020-21, the exemption limit for an individual taxpayer is set to a slab of INR 2.5 lakh.

Now the question arises; how to count gross total income? It is counted by adding up income under all individuals without accounting for the following: investment-linked deductions under chapter VI A or deduction under section 54/54F/54EC, etc. In this particular case, the gross total income is under the basic exemption limit, hence your spouse does not require to file an income tax return.


  • My son was living abroad and was an NRI in the financial year 2018-19 and 2019-20. During this time, he earned some money through dividends, interest, capital gains from the sale of shares, and some mutual fund units. Now, does he require to file Income Tax Returns in India for the assessment year 2019-20 and assessment year 2020-21? He is already paying taxes in his country with which India does not have DTAA (Double Tax Avoidance Agreement). Does he also have to declare his income that he earned in his foreign country?

Ans: According to the law, NRIs are liable to pay tax in India on the income that they have accrued in India during the previous assessment year. However, the income that is earned in earned abroad is not taxed here.

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