Tax Relief Up to 12 Lakh: Why You Still Must File Your ITR
The government introduced big tax relief for the New Tax Regime. If you earn up to ₹12 Lakh, you might not have to pay any tax at all.
However, many people think "zero tax" means they do not need to file an Income Tax Return (ITR). This is wrong. Even if your tax is zero, filing your ITR is still mandatory.
How Income Up to ₹12 Lakh Becomes Tax-Free
You get this zero-tax benefit through discounts called rebates and standard deductions.
The Rule: Income up to ₹7 Lakh is completely tax-free under a rule called Section 87A.
The Extra Relief: Budget updates allow salaried people earning up to ₹12 Lakh to use specific deductions to bring their final tax down to zero.
The Catch: The tax is still calculated on your income first. The government then applies a discount to make it zero. You must file the form to get this discount.
Why You Must File Your ITR
The Income Tax Department looks at your total earnings before any discounts are applied.
- The ₹3 Lakh Limit: In the New Tax Regime, you must file a return if you earn more than ₹3 Lakh.
- To Claim the Discount: You cannot get the tax discount automatically. You must file your ITR to show the government you qualify for zero tax.
Other Triggers: You must file an ITR if you spent over ₹2 Lakh on foreign travel or over ₹1 Lakh on electricity bills, no matter your income.
What Happens If You Do Not File?
Penalties
You will have to pay a late fee if you miss the July 31 deadline.
Loan Rejections
Banks demand 3 years of ITR receipts when you apply for a home or car loan.
Visa Issues
Many foreign embassies require your ITR papers to approve travel visas.
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