Even With Income Below ₹2.5 Lakh, These 8 Transactions Make Filing ITR Mandatory

The Income Tax Department has extended the last date for filing Income Tax Returns (ITR) this year from July 31 to September 15, 2025. While individuals earning less than ₹2.5 lakh annually under the old tax regime, or ₹3 lakh under the new regime, are generally exempt from filing ITR, there are several exceptions.

According to the Income Tax Act, 1961, taxpayers falling under certain specific situations are required to file returns, even if their income is below the basic exemption limit. Currently, there are eight key scenarios where filing an ITR is mandatory.

8 Situations That Require ITR Filing 1. Foreign Travel Expenditure Above ₹2 Lakh

If you have spent ₹2 lakh or more on overseas travel during a financial year, whether for yourself or on behalf of someone else, you must file an ITR. This rule is aimed at monitoring high-value lifestyle expenses.

2. Foreign Assets, Income, or Signing Authority

Residents of India who hold assets, property, or income abroad—such as shares, bonds, or houses—are required to file an ITR. Similarly, if you have signing authority in a foreign bank account, disclosure through ITR is mandatory. Dividends, rental income, or interest earned overseas also fall under this category.

3. High TDS or TCS Deductions

If your total TDS (Tax Deducted at Source) or TCS (Tax Collected at Source) during a financial year amounts to ₹25,000 or more (₹50,000 for senior citizens), filing ITR becomes compulsory. This ensures that individuals with significant tax deductions report their income accurately.

4. Large Deposits in Current Account

Taxpayers who have deposited over ₹1 crore in current accounts across one or multiple banks within a year must file an ITR. This rule helps authorities track large cash inflows and potential business transactions.

5. Deposits Above ₹50 Lakh in Savings Account

If your total deposits in savings accounts exceed ₹50 lakh in a financial year, ITR filing is mandatory. Even multiple smaller deposits that cumulatively cross this limit will trigger the requirement.

6. Business Turnover Above ₹60 Lakh

Entrepreneurs whose businesses record annual turnover exceeding ₹60 lakh must file ITR, regardless of whether profits are high, low, or even nil. The rule ensures accountability in commercial activities.

7. Professional Income Above ₹10 Lakh

Professionals such as doctors, lawyers, consultants, and freelancers with gross receipts over ₹10 lakh in a year must file ITR. This applies even if their net earnings are modest after expenses.

8. Electricity Bill Payments Over ₹1 Lakh

If your total electricity bill payments exceed ₹1 lakh in a financial year, filing an ITR is mandatory. The provision allows authorities to track high personal consumption patterns.

Why Foreign Assets Still Require ITR Filing

Many Indians invest in foreign shares, bonds, or property, often earning dividends, rent, or interest from abroad. Under Section 139(1) of the Income Tax Act, such income must be reported, even if the individual’s overall income is below the exemption threshold. In fact, if investments are held in the name of parents or dependents, and their income falls under the exempt category, they still need to file returns to disclose foreign assets.

Penalties for Missing the Deadline

Failure to file ITR on time, when required, can attract penalties under Section 234F. Taxpayers with income below the exemption limit but meeting any of the above conditions face a ₹1,000 fine for late filing. For those earning above ₹5 lakh, the penalty can be higher, depending on the delay.

Final Word

While individuals with income below ₹2.5 lakh (old regime) or ₹3 lakh (new regime) are usually exempt from filing returns, these eight special conditions make ITR mandatory. Taxpayers should carefully review their transactions and ensure compliance before the September 15, 2025 deadline to avoid fines and maintain a clean financial record.